These documents have been translated from Japanese originals for reference purposes only.
In the event of any discrepancy between these translated documents and the Japanese originals, the originals
shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or any otherforms of damages arising from the translations.

(Securities Code 9301)
June 4, 2020
To Shareholders with Voting Rights:
Masao Fujikura
President
Mitsubishi Logistics Corporation
19-1, Nihonbashi, 1-chome,
Chuo-ku, Tokyo, JapanNOTICE OF
THE 217TH ANNUAL GENERAL MEETING OF SHAREHOLDERS
Dear Shareholders:
We would like to express our appreciation for your continued support and patronage.
We hereby notify you of the 217th Annual General Meeting of Shareholders of Mitsubishi Logistics
Corporation (the “Company”). The meeting will be held for the purposes as described below.
From the viewpoint of preventing the spread of the novel coronavirus (COVID-19), we recommend you
refrain from attending the meeting and exercise your voting rights in writing by submitting the Voting Rights
Exercise Form, or via the Internet, etc. Please review the Reference Documents for the General Meeting of
Shareholders (pages 44 through 61), and return your form no later than 5 p.m. Japan time on Thursday, June 25,
2020, or cast your vote via the Internet, etc., by 5 p.m. Japan time on Thursday, June 25, 2020.
(Please refer to the page 62 for the detailed procedures for exercising voting rights via the Internet, etc.)
1. Date and Time:

Friday, June 26, 2020 at 10 a.m. Japan time

2. Place:

Nihonbashi Dia Building, Headquarters of the Company
19-1, Nihonbashi, 1-chome, Chuo-ku, Tokyo, Japan

3. Meeting Agenda:
Matters to be reported: 1. The Business Report, Consolidated Financial Statements for theCompany’s 217th Fiscal Year (April 1, 2019 - March 31, 2020) and resultsof audits by the Accounting Auditor and the Board of Corporate Auditors of
the Consolidated Financial Statements
2. Non-consolidated Financial Statements for the Company’s 217th Fiscal
Year (April 1, 2019 - March 31, 2020)
Proposals to be resolved:
Company Proposals (Proposal No. 1 through Proposal No. 5)
Proposal No. 1: Appropriation of Surplus
Proposal No. 2: Election of Fourteen (14) Directors
Proposal No. 3: Election of Three (3) Corporate Auditors
Proposal No. 4: Payment of Bonuses to Directors
Proposal No. 5: Determination of the Amount and Content of Remuneration for Granting ofRestricted Stock to Directors
Shareholder Proposals (Proposal No. 6 through Proposal No. 10)
Proposal No. 6: Implementation of Share Buyback
1

Proposal No. 7: Election of One (1) Director to the Company’s Board of Directors
Proposal No. 8: Election of One (1) Director to the Company’s Board of Directors
Proposal No. 9: Revisions to a Portion of the Articles of Incorporation (Change to a Company
with a Three Committee Structure)
Proposal No. 10: Revisions to a Portion of the Articles of Incorporation (Abolish Sodanyaku /Komon System)
4. Information on Exercise of Voting Rights(1) If you vote both in writing on the Voting Rights Exercise Form and via the Internet, only your vote placed
via the Internet will be valid.
In addition, if you submit your vote multiple times via the Internet, only the last vote will be valid.
(2) If you are unable to attend the meeting, you can exercise your voting rights by proxy by appointing anothershareholder with voting rights as proxy and submitting a document that attests the power of proxy.
(3) From the viewpoint of preventing the spread of COVID-19, please refrain from attending the meeting andexercise your voting rights in writing or via the Internet, etc. as the preferred method.
If you plan to attend, please check your physical condition and take necessary measures to prevent the
spread of infection such as wearing face masks.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
When attending the meeting, please submit the enclosed Voting Rights Exercise Form at the reception desk.
Any updates to the Reference Materials for the General Meeting of Shareholders, the Business Report, theConsolidated Financial Statements and Non-consolidated Financial Statements will be posted on the “Investor
Relations” on the Company’s website (https://www.mitsubishi-logistics.co.jp/english/ir/index.html).

2

(Appendix)

Business Report(April 1, 2019 - March 31, 2020)

I. Overview of the Company Group
1.
(1)

Business Progress and Results
Business Conditions
During the fiscal year under review, in the global economy, while the economy in China continued toslow moderately, economic recovery continued in the United States, and the economy in Europe also
continued to follow a mild recovery. Japan, despite a weakness in exports, recovered moderately withimproved employment environment and a recovery in consumer spending. However, from the fourth
quarter of the fiscal year, the economy, both in Japan and overseas, deteriorated drastically and currently
faces an extremely severe situation due to the impact of the COVID-19 pandemic worldwide.
In these economic situations, the business environment surrounding the Group presents an even more
adverse situation in the warehousing and harbor transportation business in the Logistics Segment due toa decline in export cargo, intensifying competition with other companies and increased costs owing tolabor shortages and other factors, as well as the impact of COVID-19 from the fourth quarter of the
fiscal year. The Real Estate Segment, meanwhile, remained relatively strong with partial rising trend in
rent due to improvement in demand for rental office buildings and others.
Under these circumstances, Mitsubishi Logistics Corporation and its subsidiaries and affiliates(collectively, the “Group”) promoted aggressive marketing activities. In the Logistics Segment, we madeefforts including the expansion of distribution operations especially for pharmaceuticals, and expansion
reinforcement of operational bases overseas. In the Real Estate Segment, we focused our efforts on
securing tenants, and maintaining and improving rent levels. Meanwhile, we endeavored to improvebusiness performance thorough cost management and further improvement of efficiency in business
operations.
As a result, revenue for the fiscal year under review amounted to 229,057 million yen, an increase of
1,871 million yen, or 0.8% from the previous fiscal year. In the Logistics Segment, revenue increased
due to an increase in freight handled both in the warehousing & distribution and land transportation
businesses, while revenue decreased due to a decrease in freight handled in both harbor transportationand international transportation businesses. In the Real Estate Segment, revenue increased mainly due toan increase in property sales in the condominiums sales business, despite a decline in the revenue due
mainly to change of tenants. Also, cost of services overall increased 2,315 million yen, or 1.1% from theprevious fiscal year to 206,141 million yen. In the Logistics Segment, operational and transportationconsignment costs decreased. However, in the Real Estate Segment, real estate sales costs increased inline with an increase in condominiums sold. Selling, general and administrative expenses amounted to
10,721 million yen, the same level as the previous fiscal year.
As a result, operating income decreased by 465 million yen, or 3.7% year on year to 12,195 million
yen, reflecting the decline in income in the Logistics Segment and the rise in income in the Real Estate
Segment. Ordinary income decreased by 511 million yen, or 3.0% to 16,822 million yen. Profit
attributable to owners of parent increased by 286 million yen, or 2.5% from the previous fiscal year to
11,851 million yen despite posting loss on valuation of marketable securities and investments insecurities, due to an increase in gain on sale of marketable securities and investments in securities.
Performance by business segment of the Group was as follows.
1) Logistics Segment
In the warehousing & distribution business and land transportation business, transactions for food/beverage, pharmaceuticals, and automotive components, etc. increased, resulting in revenue to rise 2.9%
from the previous fiscal year to 56,507 million yen in the warehousing & distribution business, andrevenue in the land transportation business increased by 0.5% from the previous fiscal year to 52,132
million yen. On the other hand, in the harbor transportation business, revenue decreased by 2.5% fromthe previous fiscal year to 23,295 million yen due mainly to a decrease in container freight handlingvolume. In the international transportation business, factors such as a decline in export and importfreight handled and the effects of a stronger yen resulted in a 5.4% decline in revenue from the previous
3fiscal year to 50,138 million yen.
As a result, overall revenue in the Logistics Segment was 189,709 million yen, down 725 million
yen, or 0.4% from the previous fiscal year. On the other hand, operating expenses were down by 300
million yen, or 0.2%, from the previous fiscal year to 182,525 million yen due to a decrease inoperational and transportation consignment costs, despite increases in temporary expenses such as realestate acquisition tax associated with the start of operations at a new distribution center and depreciation
and amortization, and facility rental expenses associated with lease of harbor facilities. Due to the above,
operating income was 7,184 million yen, a decrease of 425 million yen, or 5.6% from the previous fiscal
year.
2) Real Estate Segment
In the mainstay real estate leasing business, revenue decreased by 2.2% from the previous fiscal year
to 28,787 million yen due mainly to change of tenants. Other revenue increased by 34.1% from theprevious fiscal year to 12,412 million yen due mainly to an increase in property sales in thecondominium sales business.
As a result, overall revenue in the Real Estate Segment was 41,199 million yen, up 2,520 million yen,or 6.5% from the previous fiscal year. Operating expenses were up by 2,444 million yen, or 8.8% fromthe previous fiscal year to 30,340 million yen, primarily due to an increase in real estate sales costs assales of condominiums increased. Due to the above, operating income was 10,859 million yen, an
increase of 75 million yen, or 0.7% from the previous fiscal year.
Revenue by segment

Categories

Fiscal year
ended March
31, 2020
189,709[56,507][52,132][23,295][50,138][7,635]41,199[28,787][12,412](Millions of yen unless otherwise stated)
Year-on-year change
Fiscal year
ended March
Percentage
Amount31, 2019(%)
190,434(725)(0.4)[54,903][1,603][2.9][51,850]
[282]
[0.5]
[23,890][(595)][(2.5)][53,015][(2,876)][(5.4)][6,775][860][12.7]
38,6792,520
6.5[29,424][(637)][(2.2)][9,254][3,157][34.1]

Logistics Segment[Warehousing & Distribution Business][Land Transportation Business][Harbor Transportation Business][International Transportation Business][Other]Real Estate Segment[Real Estate Leasing Business][Other]Elimination of inter-segment(1,851)(1,928)76transactions
Total
229,057
227,1851,871
0.8(Note) Elimination of inter-segment transactions refers to the elimination of inter-segment transactions
included in the revenue of the Logistics Segment and Real Estate Segment.

4

(2)

Capital Investments
The Group made capital investments in the total amount of 26,387 million yen for construction of
warehouses and facilities for lease, etc.
The main investments made during the fiscal year under review were as follows.
1) Completed Warehouses
Kobe:
Seishin Distribution Center (Second phase)[Completed in November 2019]
Warehouses(four stories, floor area of approx. 57,400 m2)
Yokohama: Minami-Honmoku Distribution Center[Completed in February 2020]
Warehouses(five stories, floor area of approx. 35,600 m2)
2) Construction completed facilities for lease
Indonesia: P.T. Mitsubishi Logistics Indonesia MM2100[Completed in November 2019]
Factory Facility
Factory facility for lease(one story, floor area of approx. 8,000 m2)
Kanagawa: Diacrest Ryujogaoka[Completed in February 2020]
Staff quarters, Kanagawa Prefectural Police(Second phase)
Residential units for lease(five stories, floor area of approx. 8,200 m2)
3) Warehouses under construction
Saitama: Misato No.2 Distribution Center (Second phase) [Scheduled for completion in
October 2020]
Warehouses(four stories, floor area of approx. 27,700 m2)
4) Facilities for lease under large-scale renovation
Tokyo: Eitai Dia Building[Scheduled for completion in
March 2022]
Rental building for computer-processing center(14 stories, floor area of approx. 29,900 m2)(3)

Financing
The Company issued bonds as shown below to use for capital investment and repayment of loans.
1) 18th series of unsecured bonds 10 billion yen (issued on December 5, 2019)2) 19th series of unsecured bonds 10 billion yen (issued on December 5, 2019)
The capital investments and operating capital of the Group were funded by cash on hand, borrowings
from financial institutions and proceeds from issuance of the bonds mentioned above.
Additionally, the Company redeemed the 12th unsecured bonds (total face value 5 billion yen; issued
December 9, 2011) on December 9, 2019.

5

(4)

Future Outlook and Issues
For the time being, the world economy will face even more risk of downfall due to the impact of
COVID-19. The Japanese economy is expected to continue to face an extremely difficult situation due tothe impact of COVID-19.
In this economic climate, under the business environment surrounding the Group, extremely harshsituations continue in the warehousing & distribution business and harbor transportation business due toa decrease in freight volume caused by the impact of COVID-19, intensified competition and an increasein cost resulting from labor shortage. There is concern that business conditions may become stagnant in
the real estate business due to a decline in demand for rental office buildings caused by a downturn inthe economy, in addition to the expectation of measures such as rent reductions at commercial facilities
due to the impact of COVID-19.
Under these circumstances, the Group upholds a vision “MLC2030 Vision” to be accomplished in
2030, and by giving first priority to “contributing to the improvement of customer’s value,” we aim to bea corporate group that continues to be selected by customers both in Japan and overseas as a logistics
company that consistently handles the supply chain from procurement to distribution and sales as apartner of customers.
Specifically, we will implement the following measures.
1) The Group will establish a customer-oriented support system with a focus on the medical/healthcare, food/beverage, and machinery/electrical machine industries as priority areas, and will takeon comprehensive supply chain challenges as the customer’s partner. Through these efforts, theGroup will seek to expand its business domain and boost its market share.
2) Overseas, the Group will move forward with system enhancements to support customer supply
chains in the medical/health care and food/beverage industries and strengthen its forwarding
business with demand for high quality cold chains expected to grow in a number of regions suchas Southeast Asia (ASEAN).
3) The Group will further enhance the competitiveness of its port and harbor transportation
business by leveraging its cargo handling services, the efficiency of which is ranked among thehighest globally, while at the same time developing complexes and facilities and boosting its
operational capability in the real estate business. By doing so, it will seek to secure stableprofits.
4) The Group will review the operational processes of all businesses and facilitate efficient
operations by utilizing new technologies such as IoT, AI and robotics. Through these efforts, itaims to improve service quality and production efficiency.
5) The Group aims for growth by strengthening cost competitiveness through organizational
management across the Company and its Group companies and securing/developing humanresources, particularly in the priority areas.
At the same time, according to the Medium-term Management Plan FY2019–2021 which
positions the three-year period from fiscal 2019 to fiscal 2021 as the first stage for a leap toward
the achievement of the “MLC2030 Vision”, for further growth of the Group, and in order tomeet the expectations of stakeholders, including our customers, group employees, shareholders
and investors, we will work to ensure the implementation of the following measures and strive
to achieve the “MLC2030 Vision.”
1)
Strengthening the business foundations of the priority areas
2)
Establishing a system that leverages new technologies
3)
Maintaining competitiveness in the port and harbor transportation business
4)
Developing complexes and other facilities for the real estate business and improving theorganizational structure thereof to strengthen operational capabilities
5)
Bolstering production efficiency through more efficient operational processes and othermeans
6)
Improving operational conditions to reform workstyles and create innovation
7)
Increasing shareholder returns
8)
Promoting CSR-oriented management

6

2.

The Group
The Company

Trends in Assets and Income
Trends in assets and income of the Group and the Company for the fiscal year under review and thelast three fiscal years are as follows.
(Millions of yen unless otherwise stated)
The 214th fiscal The 215th fiscal The 216th fiscal Fiscal year
year
year
year
under review
Item(April 1, 2016 - (April 1, 2017 - (April 1, 2018 - (April 1, 2019 March 31, 2017) March 31, 2018) March 31, 2019) March 31, 2020)
Revenue
208,718
215,407
227,185
229,057
Operating income
12,74812,421
12,66012,195
Ordinary income
16,056
16,16017,333
16,822
Profit attributable to owners
10,665
10,517
11,564
11,851of parent
Basic earnings per share
121.75120.07132.03137.31(yen)
Total assets
435,354462,031482,575
468,243
Total net assets
276,870
294,550
299,104
286,356
Revenue
146,896
148,610
157,432
160,031
Operating income
10,284
9,665
9,016
8,899
Ordinary income
13,073
15,382
14,61913,616
Net income
9,074
10,701
10,125
10,109Basic earnings per share
103.55122.12115.55117.08(yen)
Total assets
383,730
412,693433,462
416,534
Total net assets
252,899
270,422
274,400
260,685(Notes)
1. As the Company carried out the reverse stock split at a ratio of one share for every two shares of common stock, with
an effective date of October 1, 2017, basic earnings per share of the Group and the Company are calculated based on
the assumption that the reverse stock split was conducted at the beginning of the 214th fiscal year.
2. As the Company applied “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ
Statement No. 28, February 16, 2018), etc., from the beginning of the 216th fiscal year, total assets of theGroup and the Company in the 215th fiscal year are amounts after applying the accounting standard etc.,
retroactively.
3. The decrease in operating income, ordinary income, net income, and basic earnings per share in the 216th fiscal
year was primarily due to an increase in personnel expenses and depreciation and amortization in addition toinitial expenses associated with the start of operations at a new distribution center.
4. The decrease in operating income and ordinary income of the Group and the Company in the fiscal year underreview was primarily due to a decrease in freight handled in the harbor transportation and internationaltransportation businesses.
5. Basic earnings per share of the Group and of the Company are calculated based on the weighted-average number ofshares outstanding during the relevant period and are rounded off to the second decimal place.

7

3.

Material Subsidiaries
Company name

The Company’s
Capitalpercentage of equity(Millions of yen) participation (%)

Fuji Logistics Co., Ltd.

2,979

95.0

Ryoso Transportation Co.,
Ltd.

360

100

Dia Buil-Tech, Co., Ltd.

100

100

Shinryo Koun Co., Ltd.

36

86.0

Mitsubishi Logistics China
Co., Ltd.

RMB250
million100

P.T. Mitsubishi Logistics
Indonesia
Mitsubishi Logistics
America Corporation
Mitsubishi Logistics Europe
B.V.

IDR631,665
million
USD10,000
thousand
EUR2,500
thousand(Note)

99.9
100
100

Principal business
Warehousing & Distribution
Business
Land Transportation
Business
Real Estate Managing
Business
Harbor Transportation
Business
Investment in Logistics
Business in China andmanagement of affiliate
logistics companies
Warehousing & Distribution
Business
International Transportation
Business
International Transportation
Business

P.T. Mitsubishi Logistics Indonesia implemented a capital increase on August 29, 2019, which
increased its capital by IDR420,000 million.

The number of the consolidated subsidiaries subject to consolidated accounting is 51 including 8
material subsidiaries shown above, while the number of affiliates subject to the equity method is 3. The
majority of these companies are engaged in operations and transportation related to the logistics businessand management of buildings related to the real estate business.
4.

Principal Business(1) Logistics Segment
1) Warehousing & Distribution BusinessBusiness conducting storage and handling of incoming and outgoing cargo, etc. atwarehouses containing consigned items
2) Land Transportation BusinessBusiness conducting transport and usage transport, etc. by freight automobiles
3) Harbor Transportation BusinessBusiness conducting coastal cargo handling and onboard cargo handling, etc. at ports
4) International Transportation BusinessBusiness conducting handling of international product transport, etc. (including handlingdomestic marine cargo transport)(2) Real Estate Segment
Business conducting consignment, design and oversight of purchase, leasing, management
and construction of real estate8

5.

Principal Business Locations(1) The Company
Headquarters: Chuo-ku, Tokyo
Branches: Tokyo, Yokohama, Nagoya, Osaka, Kobe and Fukuoka(2) Subsidiaries
1) Logistics Segment
Fuji Logistics Co., Ltd. (Minato-ku, Tokyo)
Ryoso Transportation Co., Ltd. (Koto-ku, Tokyo)
Shinryo Koun Co., Ltd. (Chuo-ku, Kobe)
Mitsubishi Logistics China Co., Ltd. (Shanghai, China)
P.T. Mitsubishi Logistics Indonesia (Jawa Barat, Indonesia)
Mitsubishi Logistics America Corporation (New York City, State of New York, U.S.A)
Mitsubishi Logistics Europe B.V. (Ridderkerk, South Holland, The Netherlands)
2) Real Estate Segment
Dia Buil-Tech, Co., Ltd. (Chuo-ku, Tokyo)

6.

Employees(1) Employees of the Group
Categories
Logistics Segment
Real Estate Segment
Administrative segment,
Headquarters of the Company
Total

Number of employees(Changes from previous fiscal year-end)
4,255 (increased 149)
297 (increased 11)
73 (decreased 1)
4,625 (increased 159)

(Notes)1. The figures in the above table do not include 40 persons on leave and seconded outside of
the Group.
2. Separate from the above, there are 1,298 temporary employees and 1,266 seconded andcontracted employees from outside the Group.

(2) Employees of the Company
Number of employees (Changes
from previous fiscal year-end)
952 (increased 26)

Average age

Average years of service

39 years,
10 months

16 years, 1 month(Notes)1. The figures in the above table do not include 107 persons on leave and seconded outside of
the Company.
2. Separate from the above, there are 156 temporary employees and 638 seconded andcontracted employees from outside the Company.
3. Average ages and average years of service are rounded to the nearest month.

7.

Material Lenders
Amount of borrowings(Millions of yen)
21,6998,570

Lender
MUFG Bank, Ltd.
The Norinchukin Bank

9

II. Status of Shares
1.
Matters concerning Shares(1) Total number of shares authorized to be issued

220,000,000 shares(2) Total number of shares outstanding, capital and number of shareholders
End of fiscal year
Previous fiscal
Item
under review
year-end
Total number of shares outstanding
87,960,739
87,960,739(shares)
Capital (yen)22,393,986,570
22,393,986,570
Number of shareholders (persons)
6,714
6,538
(Notes)Changes from theprevious fiscal year-end
00
176 (increased)

Total number of shares outstanding includes 2,017,892 shares of treasury shares.

(3) Major shareholders
Shareholder name

Number of shares

Shareholding ratio%

Thousand shares

The Master Trust Bank of Japan, Ltd. (trust account)
Japan Trustee Services Bank, Ltd. (trust account)
Meiji Yasuda Life Insurance Company
MITSUBISHI ESTATE CO., LTD.
Kirin Holdings Company, Limited
Tokio Marine & Nichido Fire Insurance Co., Ltd.
State Street Bank and Trust Company 505001
MUFG Bank, Ltd.
AGC Inc.
TAKENAKA CORPORATION(Notes)1.
2.
3.

11,376
5,997
5,153
3,665
2,224
2,041
2,025
1,864
1,657
1,505

13.2
7.0
6.0
4.3
2.6
2.4
2.4
2.2
1.9
1.8

In addition to the above, the Company holds 2,017 thousand shares of treasury shares.
MUFG Bank, Ltd. has set 750 thousand shares of the Company as trust funds for retirement benefits for which
voting rights are reserved, in addition to the shares stated in the table above.
The Company’s treasury shares (2,017,892 shares) were excluded in the calculation of the percentage of shares
held.

10

2. Company Officers(1)

Directors and Corporate Auditors
Position

Chairman of the Board

Akio Matsui

President *Masao Fujikura

Managing Director

Yoshiji Ohara

Managing Director

Hitoshi Wakabayashi

Managing Director

Yasushi Saito

Managing Director

Shinji KimuraManaging Director *Saburo Naraba

Managing Director

Hiroshi Nishikawa

Director

Koji Miyahara

Director

Tatsuo Wakabayashi

Director

Toshifumi Kitazawa

Director

Tatsushi Nakashima

Director

Akira Yamao

Director

Akio Miura

Corporate Auditor(full time)
Corporate Auditor(full time)
Corporate Auditor

Areas of responsibility or significant
concurrent positions
President of The Japan Warehousing
Association Inc.

Name

Responsible for Harbor Transportation
Business
Responsible for Warehousing &Distribution Business, General Manager,
Warehousing & Distribution Business
Division
Responsible for Accounting & Financing,
Information System
Responsible for Planning, Technical andReal Estate BusinessResponsible for General Affairs, Corporate
Communications, Personnel, and Internal
Audit
Responsible for International
Transportation Business, General Manager,
International Business Coordination
Chamber
Senior Advisor of Nippon Yusen Kabushiki
KaishaChairman of Mitsubishi UFJ Trust andBanking Corporation
Vice Chairman of the Board of Tokio
Marine & Nichido Fire Insurance Co., Ltd.
General Manager, Nagoya Branch
General Manager, Planning & Business
Coordination Division
General Manager, International
Transportation Business Division

Tohru Watanabe
Mikine Hasegawa
Yohnosuke Yamada

LawyerCorporate Auditor

Kenji Sakurai

Certified Public Accountant

Corporate Auditor

Hiroshi Imai

11

(Notes)1.
2.

Directors with an asterisk (*) are Representative Directors.
Of Directors, Mr. Koji Miyahara, Mr. Tatsuo Wakabayashi and Mr. Toshifumi Kitazawa are Outside
Directors as stipulated by Article 2, item 15 of the Companies Act. The Company designated themas independent officers as stipulated by Tokyo Stock Exchange, Inc. and registered them with thesaid Exchange.
3. Of Corporate Auditors, Mr. Mikine Hasegawa, Mr. Yohnosuke Yamada and Mr. Kenji Sakurai are
Outside Corporate Auditors as stipulated by Article 2, item 16 of the Companies Act. The Company
designated them as independent officers as stipulated by Tokyo Stock Exchange, Inc. and registeredthem with the said Exchange.
4. Corporate Auditor Mr. Kenji Sakurai is a Certified Public Accountant and has a considerable
knowledge regarding finance and accounting.
5. Corporate Auditor Mr. Hiroshi Imai retired as Standing Auditor of FUJI LOGISTICS CO., LTD. on
June 26, 2019.
6. Director Mr. Tatsuo Wakabayashi retired as Chairman of Mitsubishi UFJ Trust and Banking
Corporation and took office as Senior Advisor of the said company on April 1, 2020.
7. The Company has transactions such as pension fund operation consignment, etc. with Mitsubishi
UFJ Trust and Banking Corporation.
8. The Company has transactions such as insurance contract with Tokio Marine & Nichido Fire
Insurance Co., Ltd.
9. In addition to the above, the significant concurrent positions of Outside Officers are stated in “(3)Matters concerning Outside Directors” and “(4) Matters concerning Outside Corporate Auditors”
below.
10. The Directors and Corporate Auditors who retired during the fiscal year under review were as follows(1) retired on June 27, 2019
Director Noboru Hiraoka
Director Fumihiro Shinohara
Director Shigemitsu Miki
Corporate Auditor (full-time) Yoshihito Yoshizawa(2) resigned on February 28, 2020
Director Minoru Makihara
11. Of Directors shown above, responsibilities were changed as follows on April 1, 2020.
New responsibilities (Previous responsibilities)
Managing Director
Hitoshi Wakabayashi Responsible for Warehousing & Distribution
Business (Responsible for Warehousing &Distribution Business, General Manager,
Warehousing & Distribution Business Division)
Managing Director
Shinji Kimura
Responsible for Planning, Technical and Real EstateBusiness, General Manager, Technical Division(Responsible for Planning, Technical and Real EstateBusiness)
Director
Tatsushi Nakashima General Manager, Yokohama Branch (General
Manager, Nagoya Branch)
Director
Akira Yamao
General Manager, Osaka Branch (General Manager,
Planning & Business Coordination Division)
Director
Akio Miura
General Manager, Nagoya Branch (General Manager,
International Transportation Business Division)

12

(2)

Compensation to Directors and Corporate Auditors for the Fiscal Year under Review
Amount of payment
Categories
Number of persons paid
(Millions of yen)
Directors
18499(of which, Outside Directors)(5)(36)
Corporate Auditors
6
72(of which, Outside Corporate Auditors)(4)(40)(Notes)1.

Amount of payment above includes Directors’ bonuses in the total amount of 50 million yen
which will be paid subject to the approval and resolution of Proposal No. 4 “Payment of Bonuses
to Directors” at the 217th Annual General Meeting of Shareholders to be held on June 26, 2020.
2. In addition to the amounts in the above table, to Directors concurrently serving as employees (3persons during the fiscal year under review), the portions of their remuneration as employees of 49
million yen were paid.
3. The upper limit on total compensation for Directors is 600 million yen per year (of which, 100
million yen per year for Outside Directors; resolved at the 216th Annual General Meeting of
Shareholders held on June 27, 2019; not including the portion of employees’ salary for Directors
who concurrently serve as employees), with 120 million yen per year for Corporate Auditors(resolved at the 216th Annual General Meeting of Shareholders held on June 27, 2019).
In addition to the above, retirement benefits of 25 million yen were paid to Mr. Minoru Makihara, aDirector who resigned on February 28, 2020 (based on the proposal, “Final Payment of Retirement
Benefits to Directors and Corporate Auditors upon the Abolition of the Directors’ and Corporate
Auditors’ Retirement Benefits System,” approved and resolved at the 203rd Annual General Meeting of
Shareholders held on June 29, 2006).

(3) Matters concerning Outside Directors
1) Significant concurrent positions at other corporations, etc.
Name
Company name
Minoru Makihara
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.
Koji Miyahara
Toho GAS Co., Ltd.
Tatsuo Wakabayashi
Mitsubishi Materials Corporation
Toshifumi Kitazawa(Notes)MUFG Bank, Ltd.

Title
Outside Director
Outside Director
Outside Director
Member of the Board of
Directors (Outside
Director) and Member ofthe Audit & Supervisory
Committee

1.

Mr. Minoru Makihara retired as Director of Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.
on June 25, 2019.
2. The Company has transactions such as logistics operation consignment, etc. with Mitsubishi UFJ
Morgan Stanley Securities Co., Ltd.
3. The Company has transactions such as logistics operation consignment, etc. with Mitsubishi
Materials Corporation.
4. The Company has transactions such as loans and logistics operation consignment, etc. with MUFG
Bank, Ltd.

2) Main activities
During the fiscal year under review, the Company held 12 meetings of the Board of Directors. Mr.
Minoru Makihara participated in 5 meetings, Mr. Koji Miyahara participated in 12 meetings, Mr.
Tatsuo Wakabayashi in 9 meetings, and Mr. Toshifumi Kitazawa in 9 meetings. Outside Directors
stated invaluable opinions based on their distinguished insight and broad perspectives.
(Note) As Mr. Minoru Makihara resigned as Director on February 28, 2020, the number indicated ishis attendance at 11 meetings of the Board of Directors held before that date. As Mr. Tatsuo
Wakabayashi and Mr. Toshifumi Kitazawa were elected as Director at the 216th Annual
General Meeting of Shareholders held on June 27, 2019, the number indicated is theirattendance at the subsequent 9 meetings of the Board of Directors.

13(4) Matters concerning Outside Corporate Auditors
1) Significant concurrent positions at other corporations, etc.
Name
Company nameSANYO TRADING CO., LTD.
Yohnosuke Yamada
KANEMATSU CORPORATION
Kenji Sakurai(Notes)

1.
2.
3.
4.
5.

Japan Drilling Co., Ltd.

Title
Outside Director
Outside Audit &Supervisory Board Member
Audit & Supervisory Board
Member (External)

Mr. Yohnosuke Yamada retired as Audit & Supervisory Board Member of KANEMATSU
CORPORATION. on June 21, 2019.
Mr. Kenji Sakurai retired as Audit & Supervisory Board Member of Japan Drilling Co., Ltd. on
October 31, 2019.
The Company has transactions such as logistics operation consignment, etc. with SANYOTRADING CO., LTD.
The Company has transactions such as logistics operation consignment, etc. with KANEMATSU
CORPORATION.
The Company has transactions such as logistics operation consignment, etc. with Japan DrillingCo., Ltd.

2) Main activities
During the fiscal year under review, the Company held 16 meetings of the Board of Corporate
Auditors. Mr. Mikine Hasegawa participated in 12 meetings, Mr. Yohnosuke Yamada in 16 meetings,
and Mr. Kenji Sakurai in 16 meetings. During the fiscal year under review, the Company held 12
meetings of the Board of Directors. Mr. Mikine Hasegawa participated in 9 meetings, Mr. Yohnosuke
Yamada in 12 meetings, and Mr. Kenji Sakurai in 12 meetings. Each of Outside Corporate Auditors
stated invaluable opinions from an objective and professional standpoint backed by their accumulated
experiences as a lawyer and a certified public accountant, respectively.
(Note) As Mr. Mikine Hasegawa was elected as Corporate Auditor at the 216th Annual General
Meeting of Shareholders held on June 27, 2019, the number indicated is his attendance at thesubsequent 12 meetings of the Board of Directors and 9 meetings of the Board of Corporate
Auditors.

14

3.

Accounting Auditor(1)

Accounting Auditor’s Name
KPMG AZSA LLC(2)Compensation for Audit Service Set Forth in Article 2, Paragraph 1 of the Certified Public
Accountants Act
65 million yen(Notes)
1. Upon confirming the content of the audit plan, the conditions of the execution status of theaccounting audit, and the assumptions for calculating remuneration estimates, etc., of the
Accounting Auditor, the Board of Corporate Auditors has given its approval under Article 399,
Paragraph 1 of the Companies Act for the remuneration, etc., of the Accounting Auditor.
2. Under the audit agreement between the Company and its Accounting Auditor, compensation foraudits pursuant to the Companies Act and audits pursuant to Financial Instruments andExchange Law are not strictly separated, and otherwise cannot be separated. Consequently, theabove amount reflects total compensation.

(3)

Description of Service other than those Set Forth in Article 2, Paragraph 1 of the Certified
Public Accountants Act
The Company entrusts the Accounting Auditor with advisory services and the preparation of a comfort
letter for the issuance of corporate bonds, which are services other than those set forth in Article 2,
Paragraph 1 of the Certified Public Accountants Act (Non-Audit Service).

(4)

Cash and other profits payable by the Company or its subsidiaries to Accounting Auditor
157 million yen(Note)
Of significant subsidiaries of the Company, Mitsubishi Logistics China Co., Ltd., P.T. Mitsubishi
Logistics Indonesia, and Mitsubishi Logistics Europe B.V. receive audits (limited to stipulationsof the Companies Act and the Financial Instruments and Exchange Act (including laws andregulations of other countries corresponding to these laws)) from accounting auditors (including
entities possessing qualifications in other countries corresponding to these qualifications) separate
from the Accounting Auditor of the Company.

(5)

Policy Regarding Determination of Termination or Nonreappointment of Accounting Auditor
Aside from termination of the Accounting Auditor by the Board of Corporate Auditors as defined in
Article 340 of the Companies Act, should the Accounting Auditor be deemed unable to execute its duties
properly and the replacement of the Accounting Auditor be deemed necessary, the Company shall submit
the proposal to terminate or not reappoint the Accounting Auditor to the General Meeting of
Shareholders, based on a resolution of the Board of Corporate Auditors.

15

III.
1.

Company’s Systems and Policies
System to ensure that Directors execute their duties in compliance with laws and regulations andthe Articles of Incorporation and other systems to ensure proper business execution
As rules and a charter to be strictly followed by executives and employees during the course of
executing duties, the Company has formulated a “Code of Conduct” as described below, and clearlystates its position to actively work toward thorough compliance with related laws, in addition toenvironmental protection and social contribution, etc.
1) The Company will comply with laws and regulations and rules, and execute corporate activities
sincerely and fairly so as not to disrupt societal norms.
2) The Company will disclose corporate information at appropriate times and in an appropriate way,
and aim for broad communication with society.
3) The Company will continue to not have any relationships with anti-social forces that have a negative
impact on the order and safety of civil society.
4) The Company will recognize the importance of environmental issues and cooperate withenvironmental protection activities.
5) While providing services that are safe, high quality, and socially effective, the Company will work
toward societal contribution activities as a “good corporate citizen,” placing harmony with regionalsocieties and international society at the forefront.
Under this Code of Conduct, the Company has formulated “Basic Policy Regarding Implementationof Internal Control Systems” as described below, in order to ensure the appropriate execution of duties
by executives and employees and appropriateness of corporate operations.
(1) System to ensure that the Directors execute their duties in compliance with laws and regulations
and the Articles of Incorporation
Important decision-making shall be deliberated upon and resolved at a meeting of the Board of
Directors that is held once per month in principle in accordance with the Regulations on the Board of
Directors, which clarifies agenda standards. Regarding execution of duties, responsibilities for
Directors shall be defined, and each Director shall execute duties concerning their responsibilities,
with accountability pursuant to laws and regulations and the Articles of Incorporation.
Corporate Auditors shall inspect important decision-making documents, attend meetings of theBoard of Directors, the Executive Committee, and General Managers’ meetings, etc. to ascertain
the status of important decision-making and the execution of duties, and shall provide opinions.
(2) System to ensure that the employees execute their duties in compliance with laws and regulations
and the Articles of Incorporation
While ensuring thorough recognition of the Company’s “Code of Conduct” and internal
regulations, the Internal Audit Department shall audit compliance with laws and regulations andthe status of the execution of duties based on the annual audit plan, report the results to the
responsible Executive Directors, and the division responsible for compliance shall evaluate thestatus of improvement of the audit results.
In order to prevent or promptly discover and correct actions that may infringe upon laws andregulations and the Articles of Incorporation, an Internal Reporting Hotline (Helpline) shall beestablished.
Furthermore, through establishment of the Internal Control Committee and the CSR andCompliance Committee, the implementation status of internal control functions and the complianceconditions shall be evaluated, aiming to enhance the internal controls and CSR compliance.
(3) System for storage and management of information related to the execution of duties of the
Directors
Minutes for meetings of the Board of Directors and important documents, etc. regarding theexecution of duties by Directors shall be appropriately stored and managed in accordance withlaws and regulations and internal regulations.
(4) Regulations or any other systems for management of risk of loss
While aiming for thorough compliance with the Basic Risk Management Manual, etc., the Risk
Management Committee shall be established, working toward advance prevention of business risk
and risks related to finance and legal matters, alongside with strengthening measures against
natural disasters. Additionally, if risks arise, “Countermeasure Headquarters” shall be established,
16

and companywide support and countermeasures shall be thoroughly implemented, aiming forminimization of losses and early restoration of normal operations.
(5) System to ensure that the execution of duties of the Directors is efficient
Directors shall strictly maintain the efficiency and soundness of management while executing
duties related to their responsibilities according to the management plan.
In addition all Executive Directors shall deliberate regarding the execution of important duties
based on adequate documentation at the Executive Committee held about once per week (observed
by full-time Corporate Auditors), while making resolutions or reporting on execution status atmeetings of the Board of Directors.
(6) System to ensure proper business execution within the Company group consisting of the Company
and its subsidiaries
・ Executives shall be dispatched from the Company to subsidiaries. In addition to implementationof Codes of Conduct suited for the businesses of subsidiaries, they oversee the duties of Directorsof subsidiaries to be executed efficiently in accordance with the management plan.
・ The execution of important duties at subsidiaries shall be deliberated in advance with theCompany in accordance with the Regulations on Affiliate and Subsidiary Administration, andExecutive Directors in charge shall receive reports regarding the status of the execution of duties
at subsidiaries and financial conditions, etc. from the subsidiaries periodically or as needed.
・ A Group Management Meeting, comprised of the Company and significant subsidiaries, shall beheld about twice per year, ensuring the appropriateness of operations of the overall Group.
・ The Internal Audit Department shall audit compliance with laws and regulations and the status of
the execution of duties at subsidiaries. Executive Directors in charge shall receive the results,
cooperate with Corporate Auditors and Internal Audit Department of the Company and Corporate
Auditors of the subsidiaries, and express their opinions regarding the optimization of operationsof the overall Group as necessary.
・ To prevent or promptly discover and correct actions that may infringe upon laws and regulations
and the Articles of Incorporation, subsidiaries shall establish a common Internal Reporting
Hotline (Helpline) jointly with the Company.
・ Regarding risk of losses at subsidiaries, in addition to management according to the Basic Risk
Management Manual, etc., subsidiaries shall establish risk management structures according totheir business types.
・ Appropriate structures for internal controls shall be implemented and operated in order to secure
the reliability of financial reporting.
(7) Employees to assist the duties of Corporate Auditors
The Corporate Auditors’ Chamber shall be established as a department to assist the duties ofCorporate Auditors, and dedicated personnel shall be assigned.
(8) Independence of employees to assist the duties of Corporate Auditors from Directors and mattersconcerning effectiveness of instructions toward said employees
By the nature of their post, personnel dedicated to the Corporate Auditors’ Chamber shall work
directly for Corporate Auditors, and deliberation shall be made with the Board of Corporate
Auditors in advance regarding the selection of such personnel, etc.
(9) System for Directors and employees and executives and employees of subsidiaries (including
parties receiving reports from these persons) to report to Corporate Auditors and other systems forreporting to Corporate Auditors
Directors and employees as well as executives and employees of subsidiaries (including parties
receiving reports from these persons) shall report periodically to Corporate Auditors regarding thestatus of the execution of duties and financial conditions, etc., and the Internal Audit Department
shall report the results of internal audits to Corporate Auditors.
Additionally, Directors and employees as well as executives and employees of subsidiaries(including parties receiving reports from these persons) shall report as required to Corporate
Auditors regarding matters that will have a significant effect on management.
(10) System to ensure that persons reporting to Corporate Auditors do not receive unfavorable treatment
with said report as rationale
Any unfavorable treatment shall not be incurred due to reporting to Corporate Auditors
including internal reporting.
17

(11) Policies for processing expenses or liabilities incurred regarding the execution of duties by
Corporate Auditors
Expenses or liabilities incurred regarding the execution of duties by Corporate Auditors shall beprocessed appropriately in accordance with laws and regulations.
(12) Other systems to ensure the effectiveness of audits by Corporate Auditors
Corporate Auditors shall receive periodic reports from the Accounting Auditor regarding thestatus of audits, and shall conduct effective audits through internal audits by the Internal Audit
Department.
During audits, Directors and employees shall cooperate with Corporate Auditors to provide
required information at the appropriate time.
2.

Summary of the operational status of the system in 1. above
Based on the above “Basic Policy Regarding Implementation of Internal Control Systems,” theCompany has established and operated the internal control systems for the Company and subsidiaries.
A summary of the operational status of internal control systems for the fiscal year under review is asfollows.
(1) Status of the execution of duties by Directors and employees
・ Meetings of the Board of Directors were held 12 times, and the Board of Directors deliberated
important matters and made resolutions, and Directors in charge provided reports on the status ofexecution of important duties.
・ The Executive Committee, comprised of all Executive Directors (Chairman of the Board,
President, and Managing Directors) chaired by President, was held about once per week
(observed by full-time Corporate Auditors), and deliberated on important matters regarding
management.
・ In light of deliberations at the Executive Committee, each Executive Director executed duties
responsibly, including measures based on the Medium-term Management Plan [2019-2021],
according to the division of duties.
・ Aside from General Managers of Branches, the General Managers’ Meetings also comprised of
Directors, Corporate Auditors and the General Managers of the Headquarters Department were
held about once per month for a total of 10 times, and the status of the execution of duties werereported and confirmed.
・ The Internal Control Committee and CSR and Compliance Committee were each held once, andthe status of execution of duties companywide was evaluated from the independent viewpoints ofeach committee. As a measure against COVID-19, the Company set up a task force headed by the
President based on the Basic Risk Management Manual after consultation with the Risk
Management Committee.
・ To ensure thorough dissemination of the Code of Conduct and internal regulations of theCompany, internal training has been conducted, and the status of compliance among executives
and employees has been confirmed through surveys, etc.
・ Minutes for meetings of the Board of Directors and important documents, etc. regarding theexecution of duties by Directors have been managed by each responsible department according to
the number of years required as defined by laws and regulations and internal regulations.
(2) Status of the Corporate Group, composed of the Company and subsidiaries
・ To manage risk of losses arising at the Group, the Company has prepared a Basic Risk
Management Manual, and worked to disseminate it.
・ Executives and employees of the Company are dispatched to subsidiaries and manage them byexecuting their duties and conducting audits and supervision at the subsidiaries.
・ A department to manage subsidiaries were established, and the department discusses theexecution of important duties with subsidiaries, receives periodic reports from subsidiaries
regarding financial conditions, etc., and reports to Executive Directors in charge and Corporate
Auditors. Additionally, the Group Management Meeting, comprised of the Company andsignificant subsidiaries, was held twice, and business results and issues, etc. were reported andconfirmed, including the progress status of measures based on the Medium-term Management
Plan [2019 – 2021].
・ Concerning internal controls regarding financial reporting, effectiveness is evaluated based on the“Internal Control Evaluation Policy Book,” which defines the Group’s systems regarding
operation and evaluation, and basic policies such as processes and methods.
18

(3) Status of Corporate Auditors, internal audits, and internal reporting・ Aside from exchanging information with the Representative Director through periodic meetings,
etc., Corporate Auditors attended important meetings such as meetings of the Board of Directors,
the Executive Committee, and General Managers’ Meetings. In addition to the examination ofimportant documents, etc. regarding the execution of duties by Directors such as decision-making
documents, Corporate Auditors have inspected the Company’s audit and subsidiaries andconducted hearings with the Board of Directors, etc. based on the annual audit plan. Additionally,meetings of the Board of Corporate Auditors were held 16 times, and information on the status of
the Company and audit results, etc. have been shared.
・ During the formulation and implementation, etc. of their respective annual audit plans, Corporate
Auditors, the Internal Audit Department, Accounting Auditor and Corporate Auditors ofsubsidiaries have conducted periodic meetings and exchanged information as needed, executing
duties effectively and efficiently.
・ To support the execution of duties of Corporate Auditors, a Corporate Auditors’ Chamber (onededicated employee) was established at the headquarters. The dedicated staff member executed
duties under the direction of Corporate Auditors, and matters concerning related personnel, etc.
were deliberated with the Board of Corporate Auditors in advance.
・ Expenses or liabilities that arose during the course of the execution of duties of Corporate
Auditors were appropriately processed in accordance with laws and regulations upon requestfrom Corporate Auditors.
・ Aside from establishing an Internal Audit Division (seven dedicated employees) at theheadquarters as the Internal Audit Department, audit support employees (two persons) wereassigned, and auditors (one each) and audit support employees (two each) were assigned at eachbranch. Audits were conducted at the Company and Group companies based on the annual audit
plan. Audit results were reported to Executive Directors in charge and Corporate Auditors, andthe division responsible for compliance evaluated the status of improvement on a quarterly basis.
・ Including the Corporate Auditors’ Chamber, multiple common Internal Reporting Hotlines were
established in the Group, and internal regulations stipulated the prohibition of unfavorable
treatment to the person who made an internal report.
3.

Basic policy regarding the Company’s control
The Group’s primary businesses are the Logistics Business with warehousing & distribution businessat its core, and the Real Estate Business, which focuses on the leasing of buildings.
Regarding the Logistics Business, the Group aims to organically and comprehensively operate eachof the land transportation, international transportation and harbor transportation businesses centered on
the warehousing & distribution business by using information technologies. In the Real Estate Business,
the Group aims to expand the leasing business primarily in office buildings and commercial facilities byeffectively using the Group’s proprietary lands. Through fair operations of these businesses, the Groupaims to ensure appropriate profits and stable growth, and provide returns to shareholders and employees,
making contribution to realizing a prosperous society.
Due to the nature of the both businesses that needs land, building and facilities, etc. in favorable
locations, both businesses require significant investment; therefore, the Company invest its management
resources including funds in a continuous and planned manner from a long-term standpoint with the aimof expanding and developing businesses.

Although the Company does not unconditionally deny all intension of large-scale acquisition of theCompany’s shares, the Company believes that purchases in conflict with the above that damage
corporate value or common interests of shareholders are inappropriate.
Currently, the Company has not recognized any parties that are attempting large-scale acquisitions of
the Company’s share. However, the Company constantly monitors the trading status of the Company’s
shares, and in the event that a party attempting a large-scale acquisition of the Company’s shares inconflict with these views appears, and if the purchase will not contribute to the Company’s corporate
value and common interests of shareholders, appropriate countermeasures will be considered, and theCompany will prepare a system for the swift implementation of the countermeasures.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Unless otherwise stated, the content of the above report adheres to the following.
1. Monetary amounts and share numbers are rounded down.
2. Ratios are rounded to the first decimal place.
3. If the number of shares or ratio is zero, it is presented as “-.”19Consolidated Balance Sheet(As of March 31, 2020)
Description

Amount(Assets)
Current assets

Description(Millions of yen)Amount(Liabilities)
98,494

Cash and deposits

38,854

Notes and accounts receivable

36,392Marketable securities

Current liabilities

68,25725,4032,000

Notes and accounts payable
Short-term bank loans and current
maturities of long-term debt
Current portion of bonds

22,249Real estate held for sale

14,882

Income taxes payable

2,868

Other

6,404

Provision for directors’ bonuses

Allowance for doubtful accounts

(39)

Other

5,000
50
12,685

Non-current assets

369,749

Long-term liabilities

113,629

Property and equipment

233,061

Bonds payable

46,000

Buildings and structures

127,987

Long-term loans payable

19,680Machinery and equipment

4,368

Deposits on long-term leases

20,987

Land

89,63014,925Construction in progress

2,421

Other

8,653

Deferred income tax liabilities
Provision for directors’ retirement
benefits
Net defined benefit liability

10,268Intangible assets

14,505

Other

1,638

Leasehold right

7,732

Total liabilities

130

181,886

Goodwill

329

Other

6,443

Shareholders’ equity

240,453

Investments and other assets

122,182

Common stock

22,393

Investments in securities

111,587

Capital surplus

19,587Retained earnings

204,319

Long-term loans receivable

360

Deferred income tax assets

2,966

Other

7,330

Allowance for doubtful accounts(13)

Allowance for investment loss

(48)

Total assets(Net assets)

Treasury shares
Accumulated other comprehensive
incomeNet unrealized holding gains on
securities
Foreign currency translation
adjustments
Remeasurements of defined benefit
plans
Non-controlling interests

468,243(5,847)42,88743,252
389
(754)
3,015

Total net assets

286,356

Total liabilities and net assets

468,243(Figures are rounded down to the nearest million yen.)

20

Consolidated Statement of Income(April 1, 2019 - March 31, 2020)(Millions of yen)
Description

Breakdown

Revenue
Warehousing fee income
Stevedoring income
Land transportation income
Harbor stevedoring income
International transportation income
Rent of real estate for investment
Other
Cost of services
Operational and transportation consignment costs
Personnel expenses
Facility rental expenses
Depreciation and amortization
Other
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest and dividend income
Equity in earnings of unconsolidated subsidiaries andaffiliates
Other
Non-operating expenses
Interest expense
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Gain on disposal of non-current assets
Gain on sale of marketable securities andinvestments in securities
Compensation income
Extraordinary losses
Loss on disposal of non-current assets
Impairment loss
Loss on sale of marketable securities andinvestments in securities
Loss on valuation of marketable securities andinvestments in securities
Provision of allowance for investment loss
Profit before income taxes
Income taxes - current
Income taxes - deferred
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

Amount27,46918,224
52,132
17,81450,032
31,55031,83596,071
38,288
9,281
13,792
48,707229,057

206,141
22,916
10,721
12,195

3,831
1,410
484
577
316
206

5,727

1,100
16,822

75
3,686
159

3,921

1,494
162
410
1,908
30
5,232
(526)

4,006
16,737
4,705
12,031
180
11,851(Figures are rounded down to the nearest million yen.)21

Consolidated Statement of Changes in Net Assets(April 1, 2019 - March 31, 2020)(Millions of yen)
Shareholders’ equity

Balance as of April 1, 2019

Common stock

Capital surplus

22,393

19,564Retained earnings Treasury shares
197,675

Total
shareholders’equity(844)

238,788

Changes of items during period
Cash dividends(5,207)(5,207)

Profit attributable to owners ofparent11,851

11,851

Purchase of treasury shares(5,003)

Change in ownership interest ofparent due to transactions with
non-controlling interests
Changes other than to shareholders’equity, net

23

Total changes of items during period
Balance as of March 31, 2020

(5,003)
23

-

23

6,644

(5,003)

1,664

22,393

19,587204,319(5,847)240,453

Accumulated other comprehensive income
Net unrealized Foreign currency Remeasurements
translation
holding gains onof definedadjustments
securities
benefit plan

Balance as of April 1, 201957,098233

45

Total accumulated Non-controlling
otherinterests
comprehensive
income57,377

2,938

Total
net assets

299,104

Changes of items during period
Cash dividends(5,207)

Profit attributable to owners ofparent11,851

Purchase of treasury shares(5,003)

Change in ownership interest ofparent due to transactions with
non-controlling interests
Changes other than to shareholders’equity, net

23(13,845)

155

(800)

(14,490)77(14,413)

Total changes of items during period(13,845)

155

(800)

(14,490)77(12,748)

Balance as of March 31, 2020

43,252389(754)

42,887

3,015

286,356(Figures are rounded down to the nearest million yen.)22

Notes to the Consolidated Financial Statements
Notes to the Basis for Preparation of Consolidated Financial Statements
1. Scope of consolidation(1) Consolidated subsidiaries
Number of consolidated subsidiaries
51
Names of principal subsidiaries
Fuji Logistics Co., Ltd., Ryoso Transportation Co., Ltd., Dia Buil-Tech, Co., Ltd., Shinryo Koun Co., Ltd.,
Mitsubishi Logistics China Co., Ltd., P.T. Mitsubishi Logistics Indonesia, Mitsubishi Logistics America
Corporation and Mitsubishi Logistics Europe B.V.
(2) Non-consolidated subsidiaries
Names of principal non-consolidated subsidiary
Dia Logistics (M) Sdn. Bhd.
Non-consolidated subsidiaries are respectively small in scale, and the totals of total assets, revenue, profit
attributable to owners of parent (proportional amount of equity), and retained earnings (proportionalamount of equity), etc., each do not have a significant effect on the consolidated financial statements, thus
these subsidiaries are excluded from the scope of consolidation.
2. Application of the equity method(1) Non-consolidated subsidiaries and affiliates accounted for by the equity method
There are no non-consolidated subsidiaries accounted for by the equity method.
Number of affiliates subject to the equity method
3Name of principal affiliate
MY Terminals Holdings, Limited, Kusatsu Soko Co., Ltd.
(2) Non-consolidated subsidiaries and affiliates not subject to the equity method
Name of principal non-consolidated subsidiary
Dia Logistics (M) Sdn. Bhd.
Name of principal affiliate
Nakatani Transportation Co., Ltd.
As non-consolidated subsidiaries and affiliates not subject to the equity method each of these companies has
only an immaterial effect on profit attributable to owners of parent and retained earnings, etc. and isinsignificant overall, these are excluded from application of the equity method.
3. Matters concerning the fiscal year, etc., of consolidated subsidiaries
All consolidated subsidiaries excluding 18 overseas subsidiaries such as Mitsubishi Logistics America
Corporation end their fiscal years on the same day as the Company.
The last day of the fiscal year for 18 overseas subsidiaries such as Mitsubishi Logistics America
Corporation is December 31. The financial statements as of December 31 are used in the consolidated
financial statements, and if any material transactions incur during the period from December 31 to March
31, necessary adjustments are made on the consolidated financial statements.
4. Matters concerning accounting policies(1) Standards and methods for valuation of important assets
A. Securities
Available-for-sale securities
Securities with market quotations
Stated at market based on the market price, etc. on the balance sheet date.
(Valuation difference is transferred directly to net assets. The cost of sales is calculated using
the moving average method.)
Securities without market quotations
Stated at cost using the moving-average method.

23

B. Derivatives
Stated using the market value method.
C. Inventories (real estate held for sale)
Mainly stated at cost using the specific identification method.
(calculated by writing them down based on decline in profitability.)(2) Depreciation and amortization method for important depreciable or amortizable assets
A. Property and equipment (excluding leased assets)
The declining-balance method is applied.
Warehouse facilities (actual buildings), commercial facilities for lease (actual buildings) andfacilities and structures attached to buildings acquired on or after April 1, 2016 are calculated using
the straight-line method.
Furthermore, useful lives are estimated according to stipulations of the Corporation Tax Act, andlives for commercial facilities for lease (actual buildings) are determined with a standard of 20 years,
taking into account the lease agreement period, etc.
B. Intangible assets (excluding leased assets)
The straight-line method is applied.
Computer software for internal use is amortized over the estimated internal useful life (5 to 10
years) using the straight-line method.
C. Leased assets(Leased assets relating to finance lease transactions without the transfer of ownership)
Leased assets are depreciated using the straight-line method with no residual value over the leaseterm of the leased assets.
(3) Important standards of accounting for reserves
A.

Allowance for doubtful accounts
To provide for losses resulting from unrecoverable claims such as accounts and loans receivable,
allowance for doubtful accounts is recorded based on the historical write-off rate for ordinary
receivables, and based on expected uncollectable accounts individually for receivables.

B.

Allowance for investment loss
To provide for losses resulting from a decline in the substantial price of stock and investment
without market value, allowance is recorded taking into account the possibility of recovery if total
net assets of the issuing company fall below the book value.

C.

Provision for directors’ bonuses
To provide for bonuses to Directors, of estimated payment amount, amounts to be borne during the
fiscal year under review are recorded.

D.

Provision for directors’ retirement benefits
To provide for payments of retirement benefits for directors at certain consolidated subsidiaries,
amounts to be paid at the end of the fiscal year under review are recorded, based on entity's rules.

(4) Accounting treatment of retirement benefits
A. Method of attributing the estimated benefit obligation to periods
Upon calculating the retirement benefit obligation, the estimated benefit obligation is attributed tothe period up until the fiscal year under review on a benefit formula basis.
B. Amortization method of actuarial calculation differences and prior service costs
Actuarial calculation differences are amortized using the straight-line method over a certain period(5 to 15 years) within the average remaining years of service of employees, beginning from thefiscal year following the incurred year. Prior service costs are recognized using the straight-line
method over a certain period (15 years) within the average remaining years of service of employees,
beginning from the incurred year.
24

(5) Amortization method and amortization period of goodwill
Goodwill is amortized over 5 to 10 years on a straight-line basis. Any immaterial amounts are fullyrecognized as expenses as incurred.
(6) Accounting treatment of consumption taxes, etc.
For accounting treatment of consumption tax and local consumption tax, the tax exclusion method isapplied.
Changes in accounting procedures
Subsidiaries of the Company that apply international financial accounting standards have applied theInternational Financial Reporting Standard 16 “Leases” (“IFRS 16”) from the fiscal year under review. As aresult, the lessee of a lease generally recognizes all leases as assets and liabilities in the balance sheet. In
applying IFRS 16, the cumulative effect of a change in accounting policy is recognized on the application datein accordance with the transitional treatment.
The impact of this change on consolidated financial statements is immaterial.
Notes to Consolidated Balance Sheet
1. Accumulated depreciation of property and equipment
2. Accumulated deferred tax reserves for non-current assets

317,653 million yen
3,229 million yen

3. Collateral assets
Assets pledged as collateralLand

744 million yen

Obligations related to the above
Short-term bank loans

150 million yen“Other” of current liabilities

160 million yen

Long-term loans payable

555 million yen

Deposits on long-term leases

1,000 million yen

4. Guarantee liability
Liability guarantees for borrowings of other companies

25

871 million yen

Notes to Consolidated Statements of Income
Impairment loss
The Group recognized impairment loss in the following asset group for the fiscal year under review:
Location
Use
Type
Amount (million yen)
Osaka City, Osaka
Warehouse facilities
Buildings and others
69
Buildings, software, andKobe City, Hyogo
Warehouse facilities
92
othersIn calculating impairment loss, assets are grouped by the lowest level that generates a cash flow independent
from other assets or asset groups.
The above asset groups have been recognized to have reduced profitability from operating activities, and as
short-term recovery is not expected, book values for assets related to said asset groups have been reduced to
the recoverable amounts, and the reduction amount of 162 million yen (80 million yen in buildings, 38
million yen in software and 43 million yen in others) has been recorded as impairment loss in extraordinary
losses.
The recoverable amounts are measured based on net selling price or value in use. Net selling prices arederived from estimated disposal prices and value in use is considered to be zero since future cash flow
cannot be expected.
Notes to Consolidated Statement of Changes in Net Assets
1. Type and number of outstanding shares
Total number of outstanding shares as of March 31, 2020: Common stock

87,960,739 shares

2. Dividends(1) Dividend amountResolution
General Meeting of
Shareholders on
June 27, 2019
Meeting of theBoard of Directors
on October 31,
2019

Type ofstock

Total dividends(million yen)

Dividend pershare (yen)Record date

Effective dateCommon
stock

2,628

30

March 31,2019

June 28, 2019

Common
stock

2,578

30

September 30,
2019

December 2,
2019(2) Dividends whose record date is during this fiscal year, but whose effective date is after the end of thisfiscal year
The following items are proposed at the General Meeting of Shareholders to be held on June 26, 2020.
A. Total dividends

2,578 million yen

B. Source of dividends

Retained earnings

C. Dividend per share

30 yenD. Record date

March 31, 2020

E. Effective dateJune 29, 202026

Notes to Financial Instruments
1. Status of Financial Instruments
The Group raises necessary funds mainly by bank loans or issuance of bonds. Temporary cash surplus, ifany, are invested in highly secured deposits, public bonds and corporate bonds, etc.
Notes and accounts receivable are exposed to credit risk of customers. In order to reduce such credit risk,
the Group controls on due date and balance for each customer in accordance with internal customer credit
management rules.
Investments in securities are mainly stocks issued by companies with which the Group has business
relations. The Group ascertains the fair values of such stocks at regular intervals.
Short-term loans are used mainly for operating capital, while long-term loans payable are used mainly forcapital expenditure. Interest rate swap contracts may be used as a hedging instrument for long-term loans
payable with floating interest rates in order to avoid interest rate fluctuation risk. Derivatives are used basedon actual demand only.
2. Current Value, etc. of Financial Instruments
The amounts posted on the consolidated balance sheet, the fair values, and the differences thereof as ofMarch 31, 2020 are as follows. Items whose fair values are extremely difficult to measure are not includedin the following table (please see (Note 2)).
(Millions of yen)
Consolidated balance
Fair value
Difference
sheet amount(1) Cash and deposits
38,85438,854(2) Notes and accounts receivable
36,39236,392(3) Marketable securities
2,000
2,000
(4) Investments in securities
88,90388,903available for-sale securities
Total assets
166,150
166,150(1) Notes and accounts payable
22,24922,249(2) Short-term bank loans
20,122
20,122(3) Bonds payable (*1)
51,00050,924(75)(4) Long-term loans payable (*2)
24,96125,01957(5) Deposits on long-term leases
1,165
1,173
8
Total liabilities
119,498
119,489(9)(*1) Including current portion of bonds.
(*2) Including current maturities of long-term debt.

(Note 1) Calculation method of the fair value of financial instruments and securities
Assets(1) Cash and deposits, (2) Notes and accounts receivable, (3) Marketable securities:
Relevant consolidated balance sheet amounts are used because the settlement term of the above items is shortand their fair values approximate their book values.
(4) Available for-sale securities in investments in securities:
The fair values of stocks are determined using the quoted price at the stock exchange.
Liabilities(1) Notes and accounts payable, (2) Short-term bank loans
Relevant consolidated balance sheet amounts are used because the settlement term of the above items is shortand their fair values approximate their book values.
(3) Bonds payable
The fair values of bonds issued by the Company are calculated using the market price.

27

(4) Long-term loans payable
Long-term loans payable with floating interest rates require that the interest rates be amended at certain periodsof time. Therefore, relevant book values are used because their fair values approximate their book values.
Long-term loans payable with fixed interest rates are calculated using the present value of the amount ofprincipal and interest discounted using the current borrowing rate for similar loans of comparable maturity.
(5) Deposits on long-term leases
Deposits on long-term leases are calculated by the present value of future cash flows discounted using arisk-free rate.
(Note 2) Unlisted securities and others (consolidated balance sheet amount of 22,683 million yen) are notincluded in “(4) Available for-sale securities in investment in securities,” because the identification of
their fair values is deemed extremely difficult due to the absence of market values and inability toestimate future cash flows. Of deposits on long-term leases, those with future cash flows that cannot be
estimated and with fair values which are extremely difficult to measure (consolidated balance sheet
amount of 19,822 million yen) are not included in “(5) Deposits on long-term leases.”

Notes to Real Estates for Rent
The Company and some of its subsidiaries have some investments and rental property such as office buildings
for rent (including land) in Tokyo and other regions.
(Millions of yen)Amount on the consolidated balance sheet
Fair value
93,966
368,047(Note 1) The amount on the consolidated balance sheet is the amount obtained by deducting accumulated depreciation fromacquisition cost.
(Note 2) Fair value as of March 31, 2020 was the amount mainly based on appraisal by an external real estate appraiser.

Notes to Per Share Information
1. Net assets per share
2. Basic earnings per share

3,298.18 yen
137.31 yen

28

Notes to Significant Subsequent Events(Introduction of a Restricted Stock Remuneration Plan)At the meeting of the Board of Directors held on April 30, 2020, the Company reviewed the officer
remuneration system and resolved to introduce a restricted stock remuneration plan (the “Plan”) for Directors.
The proposal related to this Plan is to be submitted to the 217th Annual General Meeting of Shareholders heldon June 26, 2020.
(1) Overview of the Plan
The Company will provide remuneration in the form of monetary remuneration claims(hereinafter referred to as “Monetary Remuneration”) for the purpose of granting of restricted
stock to Directors (excluding Outside Directors; hereinafter referred to as “eligible Directors”),
and eligible Directors shall pay in all the monetary remuneration claims as contribution in kind,and receive issuance or disposal of common stock of the Company. The Company shall sign a
restricted stock allotment agreement with the eligible Directors for the issuance or disposal ofcommon stock of the Company with the provisions that eligible Directors shall not transfer,pledge as collateral, or otherwise dispose of the shares, during the period from the date of theissuance of the restricted stock until the date when an eligible Director retires or resigns as theCompany’s Director or other position determined by the Board of Directors. The specific timingof provision and distribution to each eligible Director shall be determined by the Board of
Directors.
(2) Total amount of Monetary Remuneration
It shall be not more than 150 million yen per year, within the scope of 600 million yen per year in
total including monthly remuneration as remuneration for Directors resolved at the 216th Annual
General Meeting of Shareholders held on June 27, 2019.
(3) Total number of shares of common stock to be issued or disposed of
Not more than 100,000 shares per year29

Non-consolidated Balance Sheet(As of March 31, 2020)
Description(Assets)
Current assets
Cash and deposits
Notes receivable
Accounts receivable
Marketable securities
Real estate held for sale
Prepaid expenses
Short-term loans receivable
Advances paid
Other
Allowance for doubtful accounts
Non-current assets
Property and equipment
Buildings
Structures
Machinery and equipment
Transportation equipment
Tools, furniture and fixtures
Land
Leased assets
Construction in progress
Intangible assets
Leasehold right
Software
Other
Investments and other assets
Investments in securities
Investments in capital ofsubsidiaries and affiliates
Long-term loans receivable
Guarantee deposits
Other
Allowance for doubtful accounts
Allowance for investment loss
Total assets(Millions of yen)
Description
Amount(Liabilities)
60,423Current liabilities
57,305
17,911
Accounts payable
13,272
Short-term bank loans and258
current maturities of27,198long-term debt
21,740Current portion of bonds
5,000
2,000
Accounts payable - other
4,797
14,882
Income taxes payable
2,435
689
Advances received
2,445
352
Deposits received
1,159
Provision for directors’
1,780
50
bonuses
827
Other
947
(20)
Long-term liabilities
98,543
Bonds payable
46,000Long-term loans payable
18,139356,111
Deposits on long-term leases
19,311
204,103
113,936
Deferred income tax liabilities
13,1192,990
Retirement benefits
1,972
3,115
Total liabilities
155,849
106(Net assets)
1,732
Shareholders’ equity
217,948
76,921
Common stock
22,393
3,207
Capital surplus
19,387
2,094
Legal capital surplus
19,383
Other capital surplus
411,958
7,673
Retained earnings
181,978
3,894
Legal retained earnings
3,121
390
Other retained earnings
178,857
Reserve for private
7,928
140,049
insurance
88,806
Reserve for reduction entry
15,558Reserve for special
43,986160
depreciation
4,965
General reserve
138,240
Retained earnings brought
4,228
16,971
forward409
Treasury shares(5,811)
Valuation and translation(15)
42,736
adjustments
Net unrealized holding gains(2,331)42,736
on securities
Total net assets
260,685
416,534
Total liabilities and net assets
416,534(Figures are rounded down to the nearest million yen.)Amount30

Non-consolidated Statement of Income(April 1, 2019 - March 31, 2020)(Millions of yen)
Description

BreakdownAmountRevenue
Warehousing fee income

19,545

Stevedoring income

10,195Land transportation income

28,225

Harbor stevedoring income

16,194

International transportation income

32,829Rent of real estate for investment

28,886

Other

24,154160,031

Cost of services
Operational and transportation consignment costs

74,598Personnel expenses

13,529

Facility rental expenses

6,587

Depreciation and amortization

10,653

Other

40,167Gross profit

145,536
14,494

Selling, general and administrative expenses

5,595

Operating income

8,899

Non-operating income
Interest and dividend income
Other

5,082
401

5,483

Non-operating expenses
Interest expense

448

Other

316

Ordinary income

765
13,616Extraordinary income
Gain on disposal of non-current assets
Gain on sale of marketable securities andinvestments in securities
Compensation income

51
3,686
155

3,892

Extraordinary losses
Loss on disposal of non-current assets
Impairment loss
Loss on sale of marketable securities andinvestments in securities
Loss on valuation of marketable securities andinvestments in securities
Provision of allowance for investment loss

1,348
92
410
1,908
13

Income before income taxes

3,773
13,735

Income taxes - current

4,225

Income taxes - deferred(598)

Net income

3,626
10,109(Figures are rounded down to the nearest million yen.)31

Non-consolidated Statement of Changes in Net Assets(April 1, 2019 - March 31, 2020)(Millions of yen)

Shareholders’ equity
Capital surplus
Commonstock

Balance as of April 1, 2019
Changes of items during
periodCash dividends
Net income
Provision of reserve forprivate insurance
Reversal of reserve for
reduction entry
Provision of reserve for
reduction entry
Reversal of reserve for
special depreciation
Provision of reserve for
special depreciation
Purchase of treasury
sharesChanges other than toshareholders’ equity,net
Total changes of items
during the period
Balance as of March 31,
2020

22,393Legalretainedearnings

Legal capitalsurplus

Other capitalsurplus19,3834

3,121Retained earnings
Other retained earnings
Reserve
Reserve forReserve for
for
privatespecialreduction
insurance
depreciation
entry
7,728
15,637
259

200
(107)
27
(119)
19

-

-

-

-

200

(79)

(99)

22,393

19,383

4

3,121

7,928

15,558160(Figures are rounded down to the nearest million yen.)32

Valuation andtranslation
adjustments

Shareholders’ equity
Retained earnings
Other retained earnings
Retained
General reserve earnings brought
forwardBalance as of April 1, 2019

138,240

Treasuryshares12,089

(808)

Total
shareholders'equityNet unrealized
holding gains
on securities

218,049

56,350Total
net assets

274,400

Changes of items during
periodCash dividends(5,207)(5,207)(5,207)

Net income

10,10910,10910,109

(200)

-

-

107

-

-

(27)

-

-

119

-

-

(19)

-

-

(5,003)(5,003)

Provision of reserve forprivate insurance
Reversal of reserve for
reduction entry
Provision of reserve for
reduction entry
Reversal of reserve for
special depreciation
Provision of reserve for
special depreciation
Purchase of treasury
sharesChanges other than toshareholders’ equity,net
Total changes of items
during the period
Balance as of March 31,
2020(5,003)(13,613)(13,613)-

4,881(5,003)(100)(13,613)(13,714)138,240

16,971(5,811)217,948

42,736

260,685(Figures are rounded down to the nearest million yen.)33

Notes to the Non-consolidated Financial Statements
Notes to Significant Accounting Policies
1. Standards and methods of valuation of securities(1) Stocks of subsidiaries and affiliates
Stated at cost using the moving-average method.
(2) Available-for-sale securities
Securities with market quotations
Stated at market based on the market price, etc. on the balance sheet date. (Valuation difference istransferred directly to net assets. The cost of sales is calculated using the moving average method.)
Securities without market quotations
Stated at cost using the moving-average method.
2. Standards and methods of valuation of derivatives
Stated using the market value method.
3. Standards and methods of valuation of inventories
Valuation for real estate held for sale is recorded using the cost accounting method (method to reduce bookvalues based on declines in profitability) on an individual basis.
4. Depreciation and amortization method for non-current assets(1) Property and equipment (excluding leased assets)
The declining-balance method is applied.
Warehouse facilities (actual buildings), commercial facilities for lease (actual buildings) andfacilities and structures attached to buildings acquired on or after April 1, 2016 are calculated using
the straight-line method.
Furthermore, useful lives are estimated according to stipulations of the Corporation Tax Act, andcommercial facilities for lease (actual buildings) are determined with a standard of 20 years, withadjustments made for factors such as the lease agreement period, etc.
(2) Intangible assets (excluding leased assets)
The straight-line method is applied.
Computer software for internal use is amortized over the estimated internal useful life (5 to 10 years)
using the straight-line method.
(3) Leased assets
Leased assets relating to finance lease transactions without the transfer of ownership.
Leased assets are depreciated using the straight-line method with no residual value over the leaseterm of the leased assets.

34

5. Standards of accounting for reserves
Allowance for doubtful accounts
To provide for losses resulting from unrecoverable claims such as accounts and loans receivable,
allowance for doubtful accounts is recorded based on the historical write-off rate for ordinary
receivables, and based on expected uncollectable amounts individually for receivables.
Allowance for investment loss
To provide for losses resulting from a decline in the substantial price of stock and investment
without market value, allowance is recorded taking into account the possibility of recovery if total
net assets of the issuing company fall below the book value.
Provision for directors’ bonuses
To provide for bonuses to Directors, of estimated payment amount, amounts to be borne during the
fiscal year under review are recorded.
Provision for retirement benefits
Provision for retirement benefits is provided based on the estimated benefit obligation and pension
assets as of March 31, 2020.
1) Method of attributing the estimated benefit obligation to periods
Upon calculating the retirement benefit obligation, the estimated benefit obligation is attributed tothe period up until the fiscal year under review on a benefit formula basis.
2) Amortization method of actuarial calculation differences
Actuarial calculation differences are amortized using the straight-line method over a certain period(5 years) within the average remaining years of service of employees, beginning from the fiscal year
following the incurred year.
3) Accounting treatment of retirement benefits
The method of accounting treatment of unrecognized actuarial calculation differences on retirement
benefits differs from the method of accounting for these in the consolidated financial statements.
6. Accounting treatment of consumption taxes, etc.
For accounting treatment of consumption tax and local consumption tax, the tax exclusion method isapplied.

35

Notes to Non-Consolidated Balance Sheet
1. Monetary receivables from and payables to affiliates
1,250 million yen
Short-term monetary asset
Short-term monetary liability 8,819 million yen
2. Accumulated depreciation of property and equipment

Long-term monetary asset
Long-term monetary liability

5,207 million yen
656 million yen

281,038 million yen

3. Accumulated deferred tax reserves for non-current assets

3,229 million yen

4. Collateral assets
Assets pledged as collateral
Land
Obligations related to the above
Short-term bank loans
Long-term loans payable
5. Guarantee liability

744 million yen
150 million yen
555 million yen

Advances received
Long-term deposits received

Liability guarantees for borrowings of other companies

160 million yen
1,000 million yen

901 million yen

Notes to Non-consolidated Statement of Income
Transactions with affiliates
Operating transactions
Revenue
Transactions other than operating transactions

9,501 million yen
2,072 million yen

Cost

47,454 million yen

Notes to Non-consolidated Statement of Changes in Net Assets
Number of treasury shares as of March 31, 2020
Common stock

2,017,892 shares

Notes to Tax Effect Accounting
Major factors for deferred tax assets and liabilities[Deferred income tax assets]
Enterprise taxes payable
Allowance for investment loss
Accrued bonuses
Retirement benefits
Depreciation
Impairment loss
Other
Total deferred income tax assets[Deferred income tax liabilities]
Net unrealized holding gains on securities
Reserve for reduction entry
Reserve for special depreciation
Total deferred income tax liabilities
Net deferred income tax liabilities

178 million yen
713 million yen
455 million yen
603 million yen
6,171 million yen
2,132 million yen
2,164 million yen
12,418 million yen(18,607) million yen(6,859) million yen(70) million yen(25,537) million yen(13,119) million yen

36

Notes to Related-party Transactions
Subsidiaries, etc.

(Millions of yen)

Percentage
Relationship
Name of company,
Summary ofTransaction
Balance atTypeownership of voting with related
Item
etc.
transactions
amountperiod end
rights held
parties
P.T. Mitsubishi
Long-term
99.9%
Funding
Subsidiary
Logistics
Lending of funds
loans
4,300
[-]
assistanceIndonesia
receivable(Note) Interest is determined in consideration of market interest rates.

Notes to Per Share Information
1. Net assets per share

3,033.24 yen

2. Basic earnings per share 117.08 yen
Notes to Significant Subsequent Events(Introduction of a Restricted Stock Remuneration Plan)At the meeting of the Board of Directors held on April 30, 2020, the Company reviewed the officer
remuneration system and resolved to introduce a restricted stock remuneration plan (the “Plan”) for Directors.
The proposal related to this Plan is to be submitted to the 217th Annual General Meeting of Shareholders heldon June 26, 2020.
(4) Overview of the Plan
The Company will provide remuneration in the form of monetary remuneration claims(hereinafter referred to as “Monetary Remuneration”) for the purpose of granting of restricted
stock to Directors (excluding Outside Directors; hereinafter referred to as “eligible Directors”),
and eligible Directors shall pay in all the monetary remuneration claims as contribution in kind,and receive issuance or disposal of common stock of the Company. The Company shall sign a
restricted stock allotment agreement with the eligible Directors for the issuance or disposal ofcommon stock of the Company with the provisions that eligible Directors shall not transfer,pledge as collateral, or otherwise dispose of the shares, during the period from the date of theissuance of the restricted stock until the date when an eligible Director retires or resigns as theCompany’s Director or other position determined by the Board of Directors. The specific timingof provision and distribution to each eligible Director shall be determined by the Board of
Directors.
(5) Total amount of Monetary Remuneration
It shall be not more than 150 million yen per year, within the scope of 600 million yen per year in
total including monthly remuneration as remuneration for Directors resolved at the 216th Annual
General Meeting of Shareholders held on June 27, 2019.
(6) Total number of shares of common stock to be issued or disposed of
Not more than 100,000 shares per year

37Independent Auditor’s Report
The Board of Directors of Mitsubishi Logistics Corporation :OpinionWe have audited the consolidated financial statements, which comprise the consolidated balance sheet,the consolidated statement of income, the consolidated statement of changes in net assets and the related
notes of Mitsubishi Logistics Corporation (“the Company”) and its consolidated subsidiaries (collectively
referred to as “the Group"), as at March 31, 2020 and for the year from April 1, 2019 to March 31, 2020in accordance with Article 444-4 of the Companies Act.
In our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the consolidated financial position and the results of operations of the Group for the period, forwhich the consolidated financial statements were prepared, in accordance with accounting principles
generally accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Auditof the Consolidated Financial Statements section of our report. We are independent of the Group inaccordance with the ethical requirements that are relevant to our audit of the consolidated financial
statements in Japan, and we have fulfilled our other ethical responsibilities in accordance with theserequirements. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion.
Responsibilities of Management and Corporate auditors and the board of corporate auditors for
the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with accounting principles generally accepted in Japan, and for such internal
control as management determines is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern inaccordance with accounting principles generally accepted in Japan and using the going concern basis ofaccounting unless management either intends to liquidate the Group or to cease operations, or has no
realistic alternative but to do so.
Corporate auditors and the board of corporate auditors are responsible for overseeing the directors’
performance of their duties including the design, implementation and maintenance of the Group’s
financial reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s reportthat includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that anaudit conducted in accordance with auditing standards generally accepted in Japan will always detect amaterial misstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these consolidated financial statements.
As part of our audit in accordance with auditing standards generally accepted in Japan, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks, andobtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override ofinternal control.
Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, while the objective of the audit is not to express an opinion
on the effectiveness of the Group’s internal control.
38

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting andbased on the audit evidence obtained, whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Group’s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditor’sreport to the related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may cause the Group to cease
to continue as a going concern.

Evaluate whether the presentation and disclosures in the consolidated financial statements are inaccordance with accounting standards generally accepted in Japan, the overall presentation, structure
and content of the consolidated financial statements, including the disclosures, and whether the
consolidated financial statements represent the underlying transactions and events in a manner that
achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities orbusiness activities within the Group to express an opinion on the consolidated financial statements.
We are responsible for the direction, supervision and performance of the group audit. We remainsolely responsible for our audit opinion.
We communicate with corporate auditors and the board of corporate auditors regarding, among othermatters, the planned scope and timing of the audit, significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide corporate auditors and the board of corporate auditors with a statement that we havecomplied with relevant ethical requirements regarding independence, and communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and whereapplicable, related safeguards.
Interest required to be disclosed by the Certified Public Accountants Act of Japan
We do not have any interest in the Group which is required to be disclosed pursuant to the provisions of
the Certified Public Accountants Act of Japan.
Atsuki Kanezuka
Designated Engagement Partner
Certified Public Accountant
Taro Nakamura
Designated Engagement Partner
Certified Public Accountant

Masaya Ariyoshi
Designated Engagement Partner
Certified Public Accountant
KPMG AZSA LLC
Tokyo Office, Japan
April 30, 202039

Independent Auditor’s Report
The Board of Directors of Mitsubishi Logistics Corporation :OpinionWe have audited the financial statements, which comprise the balance sheet, the statement of income, thestatement of changes in net assets and the related notes, and the supplementary schedules of Mitsubishi
Logistics Corporation (“the Company”) as at March 31, 2020 and for the year from April 1, 2019 toMarch 31, 2020 in accordance with Article 436-2-1 of the Companies Act.
In our opinion, the financial statements and the supplementary schedules referred to above present fairly,
in all material respects, the financial position and the results of operations of the Company for the period,
for which the financial statements and the supplementary schedules were prepared, in accordance withaccounting principles generally accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Auditof the Financial Statements and Others section of our report. We are independent of the Company inaccordance with the ethical requirements that are relevant to our audit of the financial statements in Japan,
and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Responsibilities of Management and Corporate Auditors and the Board of Corporate Auditors for
the Financial Statements and Others
Management is responsible for the preparation and fair presentation of the financial statements and the
supplementary schedules in accordance with accounting principles generally accepted in Japan, and forsuch internal control as management determines is necessary to enable the preparation of financial
statements and the supplementary schedules that are free from material misstatement, whether due tofraud or error.
In preparing the financial statements and the supplementary schedules, management is responsible forassessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related
to going concern in accordance with accounting principles generally accepted in Japan and using thegoing concern basis of accounting unless management either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
Corporate auditors and the board of corporate auditors are responsible for overseeing the directors’
performance of their duties including the design, implementation and maintenance of the Company’s
financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements and Others
Our objectives are to obtain reasonable assurance about whether the financial statements and the
supplementary schedules as a whole are free from material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level ofassurance, but is not a guarantee that an audit conducted in accordance with auditing standards generally
accepted in Japan will always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements andthe supplementary schedules.
As part of our audit in accordance with auditing standards generally accepted in Japan, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements and the
supplementary schedules, whether due to fraud or error, design and perform audit procedures
responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher
than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.

40Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, while the objective of the audit is not to express an opinion
on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting andbased on the audit evidence obtained, whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Company’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’sreport to the related disclosures in the financial statements and the supplementary schedules or, if
such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions may
cause the Company to cease to continue as a going concern.

Evaluate whether the presentation and disclosures in the financial statements and the supplementaryschedules are in accordance with accounting standards generally accepted in Japan, the overall
presentation, structure and content of the financial statements and the supplementary schedules,
including the disclosures, and whether the financial statements and the supplementary schedules
represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with corporate auditors and the board of corporate auditors regarding, among othermatters, the planned scope and timing of the audit, significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide corporate auditors and the board of corporate auditors with a statement that we havecomplied with relevant ethical requirements regarding independence, and communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and whereapplicable, related safeguards.
Interest required to be disclosed by the Certified Public Accountants Act of Japan
We do not have any interest in the Company which is required to be disclosed pursuant to the provisionsof the Certified Public Accountants Act of Japan.
Atsuki Kanezuka
Designated Engagement Partner
Certified Public Accountant
Taro Nakamura
Designated Engagement Partner
Certified Public Accountant
Masaya Ariyoshi
Designated Engagement Partner
Certified Public Accountant
KPMG AZSA LLC
Tokyo Office, Japan
April 30, 202041

Board of Corporate Auditors’ Audit Report (duplicated copy)

Audit Report(English Translation)
Regarding the performance of duties by the Directors for the 217th fiscal year from April 1, 2019 toMarch 31, 2020, the Board of Corporate Auditors hereby submits its audit report, which has been prepared
upon careful consideration based on the audit report prepared by each Corporate Auditor.
1. Summary of Auditing Methods by the Corporate Auditors and Board of Corporate Auditors(1) The Board of Corporate Auditors established auditing policies, allocation of duties, and otherrelevant matters, and received reports from each Corporate Auditor regarding his or her audits andresults thereof, as well as received reports from the Directors, other relevant personnel and the
Accounting Auditor regarding performance of their duties, and sought explanations as necessary.
(2) Each Corporate Auditor complied with the auditing standards of the Corporate Auditors establishedby the Board of Corporate Auditors, followed the auditing policies, allocation of duties, and otherrelevant matters, communicated with Directors, the Internal Audit Department, other employees, andany other relevant personnel, and made efforts to prepare the environment for information collection
and audit, as well as conducted the audit through the methods described below.
1. We participated in meetings of the Board of Directors, the Executive Committee, and otherimportant meetings, received reports from the Directors, employees and other relevant
personnel regarding performance of their duties, sought explanations as necessary, examined
important authorized documents and associated information, and studied the operations andfinancial positions at the headquarters and principal business offices. With respect tosubsidiaries, we communicated with, and collected information from, Directors and Corporate
Auditors of subsidiaries as well as received reports from subsidiaries on their business asnecessary.
2. In addition, with respect to the system for ensuring that the performance of duties by the
Directors as stated in the Business Report conforms to the related laws and regulations and the
Articles of Incorporation, and the contents of the resolutions of the Board of Directors regarding
preparation of other system to ensure the properness of operations of a group of enterprises
consisting of a stock company and its subsidiaries as stipulated in Article 100, Paragraphs 1 and
3, of the Ordinance for Enforcement of the Companies Act and such other system preparedbased on such resolutions (internal controls system), we received regular reports from Directors,
employees and other relevant personnel regarding the development and the operation of thesystem, requested explanations as needed and expressed opinions. With respect to internal
control over Financial Reporting, we received reports from Directors and other relevant
personnel as well as KPMG AZSA LLC regarding the status of evaluation and audit of theinternal control, and requested explanations as needed.
3. We examined the details of the basic policies pursuant to Article 118, Item 3 of the Ordinancefor Enforcement of the Companies Act set forth in the Business Report.
4. Furthermore, we monitored and verified whether the Accounting Auditor maintained its
independence and implemented appropriate audits, as well as received reports from the
Accounting Auditor regarding the performance of its duties and sought explanations asnecessary. In addition, we received notice from the Accounting Auditor that “the system forensuring that duties are performed properly” (matters set forth in each item of Article 131 of theOrdinance for Corporate Accounting) had been prepared in accordance with the Product Quality
Management Standards Regarding Audits (issued by the Business Accounting Deliberation
Council on October 28, 2005) and other relevant standards, and sought explanations asnecessary.
Based on the above methods, we examined the Business Report and the supplementary schedules
thereof, the non-consolidated financial statements (non-consolidated balance sheet, non-consolidated
statement of income, non-consolidated statement of changes in net assets, and non-consolidated notes)
and the supplementary schedules thereof, as well as the consolidated financial statements (consolidatedbalance sheet, consolidated statement of income, consolidated statement of changes in net assets andconsolidated notes) related to the relevant fiscal year.
422. Results of Audit(1)

Results of Audit of Business Report and Other Relevant Documents

1. In our opinion, the Business Report and the supplementary schedules are in accordance with therelated laws and regulations, and the Articles of Incorporation, and fairly represent the Company’s
condition.
2. We have found no evidence of wrongful action or material violation of related laws and regulations,nor of any violation with respect to the Articles of Incorporation, related to performance of duties by
the Directors.
3. In our opinion, the contents of the resolutions of the Board of Directors related to the internal
control systems are fair and reasonable. In addition, we have found no matters on which to remark
regarding the description in the Business Report and the performance of duties by the Directors
related to such internal control systems, as well as internal control over Financial Reporting.
4. We have found no matters to point out with respect to the basic policies regarding the Company’scontrol as described in the Business Report.
(2)

Results of Audit of Non-consolidated Financial Statements and Supplementary Schedules
In our opinion, the methods and results employed and rendered by Accounting Auditor KPMG
AZSA LLC are fair and reasonable.

(3)

Results of Audit of Consolidated Financial Statements
In our opinion, the methods and results employed and rendered by Accounting Auditor KPMG
AZSA LLC are fair and reasonable.

May 7, 2020
Board of Corporate Auditors, Mitsubishi Logistics Corporation
Corporate Auditor(Full-time Corporate Auditor)
Corporate Auditor(Full-time Outside Corporate
Auditor)Corporate Auditor(Outside Corporate Auditor)
Corporate Auditor(Outside Corporate Auditor)
Corporate Auditor

43

Tohru Watanabe
Mikine Hasegawa
Yohnosuke Yamada
Kenji Sakurai
Hiroshi Imai

Reference Documents for the General Meeting of Shareholders
Proposals and References
Company Proposals (Proposal No. 1 through Proposal No. 5)
Proposal No. 1: Appropriation of Surplus
As to the appropriation of surplus, the Company adheres to a policy of maintaining stable dividend inconsideration of the retained earnings level in addition to profits for the period while paying attention to thesystematic development of the logistics business centered on the warehousing & distribution business, theCompany’s mainstay business, and of the real estate business centered on building leases, strengthening its
financial structure in preparation for changes in its business environment. Additionally, under the
Medium-term Management Plan, for which fiscal year 2019 is the initial year, the Company will aim tofurther enhance shareholder returns while improving corporate performance and capital efficiency during theperiod of the management plan.
For the fiscal year ended March 31, 2020, we propose the year-end dividend of 30 yen per share, which isequivalent to the interim dividend, taking into account such factors as the above basic policies, and operating
results for the year and the retained earnings level. As a result, the annual dividend, including the interim
dividend, will be 60 yen per share, an increase of 15 yen from the previous fiscal year.
1. Matters regarding year-end dividends(1) Type of dividend property
Cash(2) Matters concerning the allotment of dividend property and its total amount
30 yen per share of common stock of the Company
The total amount: 2,578,285,410 yen(3) Effective date of the dividend of surplus
June 29, 2020
2. Other matters regarding appropriation of surplus(1) Item of surplus increased and its amountReserve for private insurance:
200,000,000 yen(2) Item of surplus decreased and its amount
Retained earnings brought forward: 200,000,000 yen

44Proposal No. 2: Election of Fourteen (14) Directors
The terms of office of all fourteen (14) Directors will expire at the conclusion of this year’s Annual
General Meeting of Shareholders. Accordingly, we nominate the following fourteen (14) candidates for
Directors:
No.

1

2

3

4

Name
(Date of birth)

Past experience and significant concurrent positions

Number ofshares of theCompany held

April 1982
Joined the Company
June 2012
General Manager, International Business Coordination Chamber
Masao Fujikura
April 2015
General Manager, Osaka Branch
10,500(March 20, 1959)
June 2016
Director and General Manager, Osaka Branch
April 2017Managing Director; and General Manager, Osaka Branch
April 2018
President (current position)[Reason for nomination as candidate for Director]
Mr. Masao Fujikura had served as General Manager of International Business Coordination Chamber, etc. After his termof office as Managing Director and General Manager of Osaka Branch, he is currently serving as President and oversees
overall business operation as a chief executive of the Company. He possesses a wealth of experience and professional
knowledge for the Company’s business operation, therefore, the Company nominated him as Director.
October 1977
Joined the Company
June 2011
General Manager, Harbor Transportation Business Division
Yoshiji Ohara
6,800
June 2014
Director and General Manager, Harbor Transportation Business(August 5, 1954)
Division
April 2016
Managing Director (current position)[Reason for nomination as candidate for Director]
Mr. Yoshiji Ohara had long served in the Harbor Transportation Business division in addition to his term of office as
General Manager of Harbor Transportation Business Division, etc. He is currently serving as Managing Director
responsible for Harbor Transportation Business. He possesses a wealth of experience and professional knowledge for theCompany’s business operation, therefore, the Company nominated him as Director.
April 1982
Joined the Company
June 2012
General Manager, Warehousing & Distribution Business
Division
April 2015
Chairman of the Board of Mitsubishi Logistics China Co., Ltd.
April 2016
General Manager, Warehousing & Distribution Business
Hitoshi Wakabayashi
Division of the Company
9,700(January 22, 1960) June 2016
Director and General Manager, Warehousing & Distribution
Business Division
April 2017Managing Director
April 2019
Managing Director; and General Manager, Warehousing &Distribution Business Division
April 2020
Managing Director (current position)[Reason for nomination as candidate for Director]
Mr. Hitoshi Wakabayashi had long served in the General Affairs division and the Warehousing & Distribution Businessdivision in addition to his term of office as General Manager of Warehousing & Distribution Business Division and an
officer in charge of an overseas subsidiary controlling the business in China, etc. He is currently serving as Managing
Director responsible for Warehousing & Distribution Business Division. He possesses a wealth of experience andprofessional knowledge for the Company’s business operation, therefore, the Company nominated him as Director.
April 1982
Joined the Company
June 2011
General Manager, Accounting & Financing Division
June 2016
Director and General Manager, Accounting & Financing
Yasushi Saito
Division
6,402(October 16, 1958)
April 2018
Managing Director; and General Manager, Accounting &Financing Division
June 2018
Managing Director (current position)[Reason for nomination as candidate for Director]
Mr. Yasushi Saito had long served in the Accounting & Financing division in addition to his term of office as General
Manager of Accounting & Financing Division, etc. He is currently serving as Managing Director responsible for
Accounting & Financing and Information System. He possesses a wealth of experience and professional knowledge for theCompany’s business operation, therefore, the Company nominated him as Director.

45

No.

Name
(Date of birth)

Past experience and significant concurrent positions
April 1982
April 2014
April 2016

5

6

7

8

Number ofshares of theCompany held

Joined the Company
General Manager, Personnel Division
General Manager, General Affairs Division, Corporate
Communications Chamber and Personnel Division
Shinji Kimura
June 2017
Director and General Manager, General Affairs Division,
5,500(July 18, 1958)
Corporate Communications Chamber and Personnel Division
April 2018
Managing Director
April 2020
Managing Director; and General Manager, Technical Division(current position)[Reason for nomination as candidate for Director]
Mr. Shinji Kimura had long served in the management division such as planning and the Harbor Transportation Businessdivision, in addition to his term of office as General Manager of General Affairs Division, Corporate Communications
Chamber and Personnel Division. He is currently serving as Managing Director responsible for Planning, Technical andReal Estate Business. He possesses a wealth of experience and professional knowledge for the Company’s business
operation, therefore, the Company nominated him as Director.
April 1982
Joined the Company
April 2014
General Manager, Nagoya Branch
Saburo Naraba
April 2017
General Manager, Tokyo Branch
6,900(October 17, 1958)
June 2018
Director and General Manager, Tokyo Branch
April 2019
Managing Director (current position)[Reason for nomination as candidate for Director]
Mr. Saburo Naraba had served as General Manager of Nagoya Branch and Tokyo Branch, and has long experience in the
Harbor Transportation Business division, as well as in the management division such as personnel. He is currently serving
as Managing Director responsible for General Affairs, Corporate Communications, Personnel, and Internal Audit. He
possesses a wealth of experience and professional knowledge for the Company’s business operation, therefore, theCompany nominated him as Director.
April 1983
Joined the Company
April 2015
General Manager, Tokyo Branch
April 2017
General Manager, Warehousing & Distribution Business
Hiroshi Nishikawa
Division
6,800(April 10, 1960)
June 2018
Director and General Manager, Warehousing & Distribution
Business Division
April 2019
Managing Director; and General Manager, International
Business Coordination Chamber (current position)[Reason for nomination as candidate for Director]
Mr. Hiroshi Nishikawa had served as General Manager of Tokyo Branch and General Manager of Warehousing &Distribution Business Division, and has long experience in the International Transportation Business division including
overseas assignment, as well as in the Warehousing & Distribution Business division. He is currently serving as Managing
Director responsible for International Transportation Business Division. He possesses a wealth of experience andprofessional knowledge for the Company’s business operation, therefore, the Company nominated him as Director.
April 1977
Joined Mitsubishi Trust and Banking Corporation
April 2012
President of Mitsubishi UFJ Trust and Banking Corporation
April 2013
Deputy Chairman of Mitsubishi UFJ Financial Group, Inc.
December 2013 President and Chairman of Mitsubishi UFJ Trust and Banking
Corporation
June 2015
Director; Deputy Chairman of Mitsubishi UFJ Financial Group,
Inc.
Chairman of Mitsubishi UFJ Trust and Banking Corporation;
Tatsuo Wakabayashi April 20160
Director of Mitsubishi UFJ Financial Group, Inc.
(September 29, 1952)
June 2016Retired from Director of Mitsubishi UFJ Financial Group, Inc.
April 2020
Senior Advisor of Mitsubishi UFJ Trust and Banking
Corporation (current position)
June 2019
Director of the Company (current position)[Significant concurrent positions]
Senior Advisor of Mitsubishi UFJ Trust and Banking Corporation
Outside Director of Mitsubishi Materials Corporation[Reason for nomination as candidate for Outside Director]
Mr. Tatsuo Wakabayashi has long been engaged in the corporate management of Mitsubishi UFJ Trust and Banking
Corporation. The Company nominated him as Director so that the Company’s management may benefit from the broad
insight and invaluable advice from him who represents the business community in Japan.

46

No.

Name
(Date of birth)

Past experience and significant concurrent positions
April 1977
April 2016

9

10

11

12

Number ofshares of theCompany held

Joined The Tokio Marine and Fire Insurance Co., Ltd.
President & Chief Executive Officer of Tokio Marine & Nichido
Fire Insurance Co., Ltd.
June 2016
Director of Tokio Marine Holdings, Inc.
April 2019
Vice Chairman of the Board of Tokio Marine & Nichido Fire
Insurance Co., Ltd. (current position)
Toshifumi Kitazawa
June 2019
Retired from Director of Tokio Marine Holdings, Inc.
0
(November 18, 1953)
June 2019
Director of the Company (current position)[Significant concurrent positions]
Vice Chairman of the Board of Tokio Marine & Nichido Fire Insurance Co., Ltd.
Member of the Board of Directors (Outside Director) and Member of the Audit &Supervisory Committee of MUFG Bank, Ltd.
Outside Director of Sekisui House, Ltd.
[Reason for nomination as candidate for Outside Director]
Mr. Toshifumi Kitazawa has long been engaged in the corporate management of Tokio Marine & Nichido Fire InsuranceCo., Ltd. The Company nominated him as Director so that the Company’s management may benefit from the broad insightand invaluable advice from him who represents the business community in Japan.
April 1976
Joined the Company
April 2017
General Manager, Nagoya Branch
Tatsushi Nakashima
6,100
June 2018
Director and General Manager, Nagoya Branch(November 29, 1957)
April 2020
Director and General Manager, Yokohama Branch (current
position)[Reason for nomination as candidate for Director]
Mr. Tatsushi Nakashima had long served in the Warehousing & Distribution Business division. He is currently serving as
Director and General Manager of Yokohama Branch. He possesses a wealth of experience and professional knowledge for
the Company’s business operation, therefore, the Company nominated him as Director.
April 1983
Joined the Company
April 2012
Deputy General Manager, Real Estate Business Division
April 2015
General Manager, Planning & Business Coordination Division
Akira Yamao
5,100
June 2019
Director and General Manager, Planning & Business(June 13, 1960)
Coordination Division
April 2020
Director and General Manager, Osaka Branch (current position)[Reason for nomination as candidate for Director]
Mr. Akira Yamao had long served in the Real Estate Business division in addition to the management division such asplanning. He is currently serving as Director and General Manager of Osaka Branch. He possesses a wealth of experienceand professional knowledge for the Company’s business operation, therefore, the Company nominated him as Director.
April 1984
Joined the Company
June 2016
General Manager, Yokohama Branch
April 2018
General Manager, International Transportation Business
Division
June 2018
General Manager, International Transportation BusinessAkio Miura
Division and International Business Coordination Chamber
5,800(November 10, 1960)
April 2019
General Manager, International Transportation Business
Division
June 2019
Director and General Manager, International Transportation
Business Division
April 2020
Director and General Manager, Nagoya Branch (current position)[Reason for nomination as candidate for Director]
Mr. Akio Miura had long served in the International Transportation Business division including overseas assignment. He iscurrently serving as Director and General Manager of Nagoya Branch. He possesses a wealth of experience andprofessional knowledge for the Company’s business operation, therefore, the Company nominated him as Director.

47

No.

Name
(Date of birth)

Past experience and significant concurrent positions

Number ofshares of theCompany held

April 1978
April 2015

Joined Nippon Yusen Kabushiki Kaisha
President, Representative Director, President Corporate OfficerofNippon Yusen Kabushiki Kaisha
Tadaaki Naito
June 2019
Chairman, Director, Chairman Corporate Officer of Nippon(September 30, 1955)
0
Yusen Kabushiki Kaisha (current position)
New candidate[Significant concurrent positions]13
Chairman, Director, Chairman and Executive Officer of Nippon Yusen Kabushiki
Kaisha (scheduled to take office in June 2020)[Reason for nomination as candidate for Outside Director]
Mr. Tadaaki Naito has long been engaged in the corporate management of Nippon Yusen Kabushiki Kaisha. The Company
nominated him as Director so that the Company’s management may benefit from the broad insight and invaluable advice
from him who represents the business community in Japan.
April 1986
Joined the Company
Masanori Maekawa April 2016
Deputy General Manager, General Affairs Division
April 2018
General Manager, General Affairs Division, Corporate(April 13, 1962)
500
Communications Chamber and Personnel Division (current
New candidate
position)
14[Reason for nomination as candidate for Director]
Mr. Masanori Maekawa had long served in management divisions such as general affairs and personnel, in addition to the
Warehousing & Distribution Business division. He is currently serving as General Manager of General Affairs Division,
Corporate Communications Chamber and Personnel Division. He possesses a wealth of experience and professional
knowledge for the Company’s business operation, therefore, the Company nominated him as Director.
(Notes)1. There are no special interests between each candidate and the Company.
2. Responsibilities of the candidates at the Company who are incumbent Directors of the Company are as stated in the Business
Report (pages 11 through 12).
Additionally, the two Directors, Mr. Tatsuo Wakabayashi and Mr. Toshifumi Kitazawa are incumbent Outside Directors of theCompany.
3. Matters regarding the candidates for Outside Director are as follows.
(1) Three Directors, Mr. Tatsuo Wakabayashi, Mr. Toshifumi Kitazawa and Mr. Tadaaki Naito are candidates for Outside
Director. If the election of each candidate for Director is approved, the Company plans to designate them as
independent officers as stipulated by Tokyo Stock Exchange, Inc. and register them with the said Exchange.
(2) Years of service as Outside Directors of the Company since their first appointment (until the conclusion of this year’s
Annual General Meeting of Shareholders)Mr. Tatsuo Wakabayashi: 1 year
Mr. Toshifumi Kitazawa: 1 year48

Proposal No. 3: Election of Three (3) Corporate Auditors
The terms of office of Corporate Auditors Yohnosuke Yamada and Hiroshi Imai will expire, and Corporate
Auditor Kenji Sakurai will resign, at the conclusion of this year’s Annual General Meeting of Shareholders.
Accordingly, we nominate the following three (3) candidates for Corporate Auditor.
Furthermore, the approval of the Board of Corporate Auditors has been obtained regarding the submissionof this Proposal.
No.

Name
(Date of birth)

Past experience and significant concurrent positions

Number ofshares of theCompany held

April 1989

1

2

3

Registered as lawyer (Dai-Ichi Tokyo Bar Association)
Joined Nagashima & Ohno (currently Nagashima Ohno &Tsunematsu)
Yohnosuke Yamada October 1989
Joined Yamada Brothers (currently Yamada, Goya & Suzuki)
525(May 2, 1959)(current position)
June 2004
Corporate Auditor of the Company (current position)[Significant concurrent positions]
Outside Director of SANYO TRADING CO., LTD.
[Reason for nomination as candidate for Outside Corporate Auditor]
The Company nominated Mr. Yohnosuke Yamada as Corporate Auditor so that the Company’s auditing may benefit fromhis wealth of knowledge and broad insight based on his long experience as a lawyer.
Registered as Certified Public Accountant
March 1988
Representative Partner of Asahi & Co. (currently KPMG AZSAMay 2003
LLC)
Board Member of KPMG AZSA & Co.
July 2007
June 2009Retired from Board Member of KPMG AZSA & Co. (currently
Takao Sato
KPMG AZSA LLC)
(July 17, 1954)
0
July 2014
Auditor of KPMG AZSA LLC
New candidate
June 2016Retired from Auditor of KPMG AZSA LLC
Representative of Takao Sato Accounting Office (current
July 2017
position)[Significant concurrent positions]
Outside Director of IX Knowledge Inc.
[Reason for nomination as candidate for Outside Corporate Auditor]
The Company nominated Mr. Takao Sato as Corporate Auditor so that the Company’s auditing may benefit from thewealth of knowledge and broad insight based on his long experience as a Certified Public Accountant.
April 1983
Joined the Company
April 2014
Deputy General Manager, Yokohama Branch
Junya Miura
June 2016
General Manager, Audit Division (current position)(July 22, 1959)
5,900[Significant concurrent positions]
New candidate
Full-time Corporate Auditor of Ryoso Transportation Co., Ltd. (scheduled to takeoffice in June 2020)[Reason for nomination as candidate for Corporate Auditor]
Mr. Junya Miura had long served in management divisions such as general affairs and accounting & financing. He iscurrently serving as General Manager of Audit Division. He possesses a wealth of experience and professional knowledge
for the Company’s business operation, therefore, the Company nominated him as Corporate Auditor.
(Notes)1. There are no special interests between each candidate and the Company.
2. Mr. Yohnosuke Yamada is incumbent Outside Corporate Auditor of the Company.
3. Mr. Yohnosuke Yamada and Mr. Takao Sato are candidates for Outside Corporate Auditor and matters regarding them are as
follows.
(1) If they are elected as Corporate Auditors, the Company plans to designate them as independent officers as stipulatedby Tokyo Stock Exchange, Inc. and register them with the said Exchange.
(2) Although they have not participated in corporate management, the Company has judged that they will be able toappropriately execute their duties as Outside Corporate Auditor owing to the reason for nomination as candidate for
Outside Corporate Auditor above.
(3) Years of service as Outside Corporate Auditor of the Company since their first appointment (until the conclusion of thisyear’s Annual General Meeting of Shareholders)Mr. Yohnosuke Yamada: 16 years

49

Proposal No. 4: Payment of Bonuses to Directors
Taking into consideration the current performance, among other factors, we propose to pay bonuses to
Directors, excluding Outside Directors, at the amount of 50,000,000 yen to eleven (11) Directors as of theend of the fiscal year under review.
Proposal No. 5: Determination of the Amount and Content of Remuneration for Granting of Restricted
Stock to Directors
At the 216th Annual General Meeting of Shareholders held on June 27, 2019, the amount of remuneration
for Directors of the Company has been resolved to be not more than 600 million yen per year (including notmore than 100 million yen per year for Outside Directors, and the amount of remuneration for Directors does
not include salaries for employees of Directors who also serve as employees.). However, this time, theCompany proposes to provide a new remuneration for the purpose of granting restricted stock to Directors(excluding Outside Directors; hereinafter referred to as “eligible Directors”) within the amount of
remuneration described above. This is intended to provide Directors with incentive for making sustainableimprovements to the corporate value of the Company and to promote their further sharing of value withshareholders.
The total amount of the monetary remuneration to be paid to eligible Directors for the purpose of granting
restricted stock in accordance with this Proposal shall be within the annual amount of 150 million yen per year,
which is the amount deemed reasonable in order to achieve the goals listed above. The specific distribution toeach eligible Director shall be resolved by the Board of Directors. However, the current monetary
remuneration shall be reduced upon the granting of restricted stock.
The number of eligible Directors, if Proposal No. 2 is approved as proposed, will be eleven (11) Directors.
Based on the resolution of the Board of Directors, eligible Directors shall pay in all the monetary
remuneration claims arising from this Proposal as contribution in kind, and receive issuance or disposal of theCompany’s common stock. The total annual limit of the shares of common stock of the Company thus issued
or disposed of shall be within 100,000 shares per year. Provided, in the event of a stock split (including gratis
allotment of common stock.) or the reverse share split of common stock of the Company, or othercircumstances that require an adjustment to the total number of common stock of the Company to be issued or
disposed of as restricted stock, on or after the day this Proposal is approved, the total number of shares shall be
adjusted to the extent reasonable. The amount to be paid in per share at issuance or disposal shall be theclosing price of common stock of the Company on the Tokyo Stock Exchange on the business day immediately
prior to the date of each resolution of the Board of Directors (if there were no transactions made on that day,the closing price on the most recent trading day before that day), at an amount resolved by the Board of
Directors in a range not particularly advantageous to eligible Directors. The Company shall sign a restricted
stock allotment agreement (hereinafter referred to as the “Allotment Agreement”) with the eligible Directors
including the following provisions for the issuance or disposal of common stock of the Company.
(1) For the common stock received according to the Allotment Agreement (hereinafter referred to as“Allotted Shares”), eligible Directors shall not transfer, pledge as collateral, or otherwise dispose of(hereinafter referred to as “Transfer Restrictions”) Allotted Shares, during the period from the date of theissuance of such shares until the date when an eligible Director retires or resigns as the Company’s
Director or other position determined by the Board of Directors (or, if an eligible Director retires orresigns from the Company within three months after the elapse of the fiscal year in which the issuancedate of the Allotted Shares falls, a date the Board of Directors separately determines within six months
after the elapse of that fiscal year) (hereinafter referred to as the “Transfer Restriction Period”).
(2) If an eligible Director retires or resigns from the position defined in (1) above prior to the expiry of theperiod set by the Board of Directors (hereinafter referred to as the “Period of Service”), the Company
shall acquire the Allotted Shares without consideration as a matter of course, unless there is any reason
deemed justified by the Board of Directors.
(3) The Company shall remove Transfer Restrictions from all Allotted Shares at the time the Transfer
Restriction Period expires, on the condition the eligible Director continued to serve in the position definedin (1) above throughout the Period of Service. However, if the eligible Director retires or resigns from theposition defined in (1) above prior to the expiry of the Period of Service due to a reason deemed justified
by the Board of Directors as defined in (2) above, the number of Allotted Shares subject to removal of50

Transfer Restrictions shall be reasonably adjusted as necessary.
(4) The Company shall acquire without consideration as a matter of course the Allotted Shares not subjected
to removal of Transfer Restrictions according to (3) above at the time of expiry of the Transfer Restriction
Period.
(5) Regardless of the provisions stated in (1) above, if matters related to reorganization such as a merger
agreement in which the Company is absorbed or a share-exchange agreement or share transfer plan inwhich the Company becomes a wholly-owned subsidiary are approved at the Company’s general meetingof shareholders (or, approved by the Board of Directors for cases in which approval from the general
meeting of shareholders is not required for such reorganization) during the Transfer Restriction Period,
the Company shall remove Transfer Restrictions from a number of Allotted Shares reasonably determinedaccording to the period from the start of the Period of Service until the approval date of said
reorganization, prior to the effective date of the reorganization based on a resolution by the Board of
Directors.
(6) In the case of (5) above, the Company shall acquire without consideration as a matter of course the
Allotted Shares not subjected to removal of Transfer Restrictions immediately following the removal ofTransfer Restrictions according to (5) above.
(7) The Allotment Agreement shall include the method of indicating intention and issuing notice under theagreement, the method of its revision and other matters decided by the Board of Directors.

51

Shareholder Proposals (Proposal No. 6 through Proposal No. 10)
Proposal No. 6 through Proposal No. 10 are proposed by one shareholder. The title, summary and reasons of
the proposals are shown as originally submitted by the shareholder.
Proposal No. 6: Implementation of Share Buyback(1) Summary of the Agenda Item
The Company shall acquire 4,522,840 shares of the Company’s common shares (“Common Shares”)
by payment of an acquisition cost of up to a total of 10 billion Japanese Yen (however, if the permitted
total acquisition cost under the Companies Act (Clause 461 of the Companies Act, “Distributable
Amount”) is less than the aforementioned acquisition cost, then up to such amount) within one year fromthe end of the annual shareholders’ meeting in accordance with Article 156, Paragraph 1 of theCompanies Act.
(2) Reasons for the Proposal
The Company announced plans to implement share buybacks of approximately 15 billion JPY between
2019 and 2021 to increase shareholder returns,1 of which 5 billion JPY has been completed. The present
considerably depressed share price2 makes a discounted share buyback possible, which is now an evenmore effective measure to improve shareholder returns than when this plan was announced. The PBR of
the Company is at historically low levels and it is currently lower than the PBR at the time of financial
crisis in 2008. As such, we believe that repurchasing shares at the current price is the most efficientinvestment available, and that the Company should first use all of the remaining budget set for sharebuybacks in the Medium-Term Plan to repurchase shares and seek further buybacks. Buybacks enhancelong-term corporate value, improve capital efficiency and make it possible to invest in more profitable
growth. Buybacks will also improve the Company’s ROE which is currently lower than 5%. Accordingly,
we propose a share buyback of up to 10 billion JPY which is in line with the Company’s announcement.
Opinion of the Company’s Board of Directors on Proposal No. 6
The Company’s Board of Directors opposes Proposal No. 6.
Reason for opposition
The Company has been steadily promoting share buyback plans of 15 billion yen in total between
fiscal 2019 and fiscal 2021, and 5 billion yen has already been completed.
We plan to buy back the remaining shares amounting to 10 billion yen within the period without
any changes to the plan at present. In addition, we intend to substantially increase dividends
following the previous fiscal year as a shareholder return measure.
However, under the current circumstances, in which the spread of COVID-19 is expected to havea serious impact on the economy and the fact that it is not possible to reasonably predict when thissituation will come to an end, we believe that making a definite commitment to promptly buy backthe remaining shares of 10 billion yen may have the potential of damaging corporate value and thecommon interests of shareholders.
The Company determined that buying back the remaining shares of 10 billion yen in the twoyears from fiscal 2020 to fiscal 2021 observing the extent of the impact of COVID-19 on theeconomy and the timing it settles down will contribute to corporate value and the common interestsof shareholders.

1
2

Mitsubishi Logistics Group, Outline of the New Medium-Term Management Plan [2019-2021], p. 10,https://www.mitsubishi-logistics.co.jp/english/ir/policy/pdf/medterm_2019_2021.pdf.
The Covid-19 outbreak is anticipated to have relatively little impact on the Company’s business as the Company mainly
provides logistics business to the socially important pharmaceutical and food sectors.

52

Proposal No. 7: Election of One (1) Director to the Company’s Board of Directors(1) Summary of the Agenda Item
The below candidate shall be elected as a Director.
Mr. Satoshi Arai
(2) Reasons for the Proposal
Japan’s Corporate Governance Code (“CGC”)3 requires companies to consider utilizing directors
without close ties with management, to ensure effective, independent and objective board oversight.4
Institutional Shareholder Services’ (“ISS”) Japan Proxy Voting Guidelines also provide that affiliates ofcross-shareholding companies should not be considered independent. While the Company committed toboost corporate governance through multiple initiatives, including appointing outside directors to enhance
its board function, every Outside Director on the Board is from the Mitsubishi keiretsu and thus, cannot beperceived as truly independent outside directors. In addition, the Company has not provided sufficient
explanation as to the necessity to elect an individual from the same Mitsubishi keiretsu company toreplace a retiring Outside Director. It is imperative for the Company to nominate highly qualified, outside,truly independent individuals to be Outside Directors, in order to improve corporate value pursuant to
CGC5 and METI’s guidelines.6(3) Brief bio of the candidate
Birthdate: January 18, 1955
Number of Company Shares Owned:
0 shares■ Brief biography, position at Company, area of responsibility, other important positions
1977－1979 Daiwa Securities Co. Ltd.

Satoshi Arai

1979－2012

Tsumura Juntendo Co. (currently TSUMURA & CO.)
2000

Executive Board Member

2003

Executive Officer

2004 – 2012

Board Director

2012 – 2018

Special Adviser

2012－2014

Tsumura Combined Management Co., Board Director and Chairperson

2014－2018

Logitem Tsumura Co, Ltd., Representative Director<Status of important concurrent position>
N/A(Special conflicts of interest) There are no special conflicts of interest between Mr. Arai and
the Company.
Reason for selecting as a nominee:
Mr. Arai’s decades of experience in business, including his service as an executive in thelogistics business, specialized in the pharmaceutical sector, which is an area that the Company
is trying to strengthen, would provide the Company’s management with invaluable insight asan outside expert. Moreover, adding an industry expert with experience outside of the
Mitsubishi keiretsu will add to the diversity of the Board, in line with Principle 4.11 of the
Corporate Governance Code. Accordingly, we propose that Mr. Arai be elected as an Outside
Director of the Board.
(Note) Mr. Arai is an outside director candidate.
3
4
5
6Japan’s Corporate Governance Code, see https://www.jpx.co.jp/english/news/1020/b5b4pj000000jvxratt/20180602_en.pdf.
Principle 4.6 of Japan’s Corporate Governance Code.
Principles 4.6 and 4.11 of Japan’s Corporate Governance Code.
Ministry of Economy, Trade and Industry, Practical Guidelines for Corporate Governance Systems, p. 17,
https://www.meti.go.jp/english/press/2017/pdf/0331_005b.pdf.

53

Proposal No. 8: Election of One (1) Director to the Company’s Board of Directors(1) Summary of the Agenda Item
The below candidate shall be elected as a Director.
Mr. Taketo Yamakawa(2) Reasons for the Proposal
Most JPX-Nikkei 400 companies have appointed one-third or more independent directors, and thenumber of companies doing so has been increasing every year.7 In contrast, the Company’s outside
director ratio is 21%, or 0% excluding Mitsubishi keiretsu representatives.8
We applaud the Company’s corporate governance policy to enhance its board monitoring function bymeans including appointing multiple Outside Directors. However, the Company’s warehouse and logistics
business is currently valued at negative 101 billion JPY.9 We believe the Company will be able totransform this into a positive number and improve its overall corporate value through measures including
resolving the Company’s excessive spending on overhead, which amounts to approximately 31% of theCompany’s total operating profit, 10 and actively investing in IT to improve efficiency after are-assessment of the Company’s IT system. To implement such business innovations and to enhance
corporate value pursuant to CGC 11 and METI’s guidelines, 12 it is imperative to nominate truly
independent Outside Directors with extensive experience in the industry.
(3) Brief bio of the candidate
Birthdate: September 14, 1958
Number of Company Shares Owned:
0 shares■ Brief biography, position at Company, area of responsibility, other important positions
1981 – 1990 Nissho Iwai Corporation

Taketo Yamakawa

1990 – 2006

2006－20072009－2019

General Electric Company (GE)1993

GE Capital Japan, Managing Director & Chief Representative

1996

GE Consumer Finance Japan, President & CEO

1999

GE Nissen Credit, Board Member (concurrent)

2000

General Electric Company, Corporate Officer & Vice President

2005

Hyundai Capital, Board Member (concurrent)

2005

GE Consumer Finance North Asia, President & CEO (concurrent)

Kohlberg Kravis Roberts Japan Ltd., Chief Executive & Representative
Director
DHL Japan Inc., President & Representative Director<Status of important concurrent position>
N/A

7

8

9

10
11
12

A 15.1% increase from 2018. Tokyo Stock Exchange, Inc., Report on Appointment of Independent Directors andEstablishment of Nomination and Remuneration Committees by TSE-Listed Companies (August 1, 2019),
https://www.jpx.co.jp/english/listing/others/ind-executive/tvdivq0000001j9j-att/b5b4pj000002zfp5.pdf.
As noted in ISS’ Japan Proxy Voting Guidelines, affiliates of cross-shareholding companies should not be considered
independent. Every Outside Director on the Board is from the Mitsubishi keiretsu and thus, cannot be perceived as truly
independent outside directors.
The Company’s stock price net of real estate, cross-shareholdings, debt and cash attributes a negative 101 billion JPY value
to its warehouse and logistics business (Oasis calculations based on Company public disclosures and Bloomberg data as ofApril 9, 2020).
Oasis calculations based on Company public disclosures.
Principles 4.6 and 4.11 of Japan’s Corporate Governance Code.
Ministry of Economy, Trade and Industry, Practical Guidelines for Corporate Governance Systems, p. 17,
https://www.meti.go.jp/english/press/2017/pdf/0331_005b.pdf.

54

(Special conflicts of interest) There are no special conflicts of interest between Mr. Arai and
the Company.
Reason for selecting as a nominee:
Mr. Yamakawa has substantial experience in introducing robotic process automation (RPA) to
reduce the overhead cost within the logistics business. Mr. Yamakawa’s broad knowledge ininvestment, combined with his solid experience in the logistics business, would be invaluable
to the Company’s management. Moreover, adding an industry expert with international
experience will add to the diversity of the Board, which is in line with Principle 4.11 of the
Corporate Governance Code. Accordingly, we propose that Mr. Yamakawa be elected as an
Outside Director of the Board.
(Note) Mr. Yamakawa is an outside director candidate.
Opinion of the Company’s Board of Directors on Proposal No. 7 and Proposal No. 8
The Company’s Board of Directors opposes Proposal No. 7 and Proposal No. 8.
Reason for opposition
The three candidates for Outside Director proposed by the Company meet the criteria for
independent officers as stipulated by Tokyo Stock Exchange, Inc., and the Company plans todesignate them as independent officers and register them with said Exchange. All three candidates
have experience as presidents of large corporations leading Japan, and based on their wealth ofexperience and broad insight, are capable of effectively providing advice and supervision from an
independent and objective perspective on issues related to corporate governance such as thenomination and remuneration of Directors. They will be able to express candid and unsparing
opinions at meetings of the Company’s Board of Directors as Outside Directors.
In addition, if necessary, they will also be able to take on the functions of supervising
management, including appointment and dismissal of top management, reduction of remunerationfor officers, etc. from the perspective of shareholders as a whole.
In comparison, the candidates for Outside Director listed in the shareholder proposals arerecommended by a particular major shareholder. We believe that it is necessary to fully consider therisk that a particular major shareholder prioritizes its own interests and intervene in specificmanagement decisions through personnel serving as Outside Director, a position that is originallyintended to be independent. We also believe that a sufficient period of consideration is necessary to
determine a candidate’s fulfillment of the qualifications for an Outside Director required by theCompany and examine the potential existence of other relevant risks.
However, this proposal was made in late April. There was an extremely limited amount of time
available to fully consider the content before the general meeting of shareholders, and it wasdifficult to schedule a direct meeting due to the spread of COVID-19. In consideration of the above,it is not possible to sufficiently and reasonably judge whether these candidates are truly appropriate
for the position of Director from the viewpoint of securing corporate value and the common interestsof shareholders.
Furthermore, in order to optimize the composition of the Board of Directors and continuously
improve its effectiveness to contribute to the improvement of corporate value in the mediumto-long term, the election of Directors shall be carried out in a systematic manner in concert withestablishing systems for various initiatives related to corporate governance.
The Company’s Board of Directors believes that the structure of the Board of Directors proposedby the Company is the optimal system for management in the current business environment from theviewpoint of securing corporate value and the common interests of shareholders, and has therefore
decided that it is appropriate to oppose these shareholder proposals.

55

Proposal No. 9: Revisions to a Portion of the Articles of Incorporation (Change to a Company with aThree Committee Structure)(1) Summary of the Agenda ItemThe current Articles of Incorporation shall be revised as follows, in order to adopt a three committee
structure. The clauses related to this agenda item shall be modified to reflect the formalistic changes
required (including but not limited to renumbering of the articles) to account for the other agenda items inthe shareholders’ meeting (including agenda items related to Company proposals) that are approved.
Current Articles of Incorporation
Article 10 The procedures and fees relating to
information entry and recording of the Company’s
shareholder registry and stock option registry, thepurchase and additional purchase of shares lessthan one unit, and stock options, shall follow therules of handling shares as determined by the
Board of Directors.
Article 11 The Company shall retain a shareholder
registry administrator.
2. The shareholder registry administrator and its
place of business operations shall be determinedby resolution of the Board of Directors and shallbe announced publicly.
3. The Company’s shareholder registry and stock
option registry shall be kept at the shareholder
registry administrator’s place of business
operations. Matters related to the shareholder
registry and the stock option registry shall be
entrustedwiththeshareholder
registryadministrator and shall not be handled by theCompany.
Article 14 The Director-President shall convene
Shareholders’ Meetings and serve as chair. In theevent that the Director-President is unavailable,another Director, chosen according to the order
determined by the Board of Directors in advance,
shall take his/her place.

Proposed Changes
Article 10 The procedures and fees relating to
information entry and recording of the Company’s
shareholder registry and stock option registry, thepurchase and additional purchase of shares lessthan one unit, and stock options, shall follow therules of handling shares as determined by the
Board of Directors or the Executive Officer(s)entrusted by the Board of Directors throughresolution.
Article 11 The Company shall retain a shareholder
registry administrator.
2. The shareholder registry administrator and its
place of business operations shall be determinedby the Board of Directors or the Executive
Officer(s) entrusted by the Board of Directors
through resolution and shall be announced
publicly.
3. The Company’s shareholder registry and stock
option registry shall be kept at the shareholder
registry administrator’s place of business
operations. Matters related to the shareholder
registry and the stock option registry shall be
entrustedwiththeshareholder
registryadministrator and shall not be handled by theCompany.
Article 14 The Director with a dual role as the
President shall convene the Shareholders’ Meetingand serve as its chair. In the event that there is no
Director with a dual role as the President in place
or if the Director with a dual role as the President
is unavailable, another Director, chosen according
to the order determined by the Board of Directors
in advance, shall take his/her place.
(Deleted)

Article 23 The Board of Directors shall elect a few
Representative Directors.
2. The Board of Directors shall elected one (1)Chairperson for the Board of Directors, one (1)Director-President, one (1) Director-VicePresident, and a few Senior Managing Directors
and Managing Directors; provided, however, thepositions of Chairperson for the Board of
Directors, Director-Vice-President or Senior
Managing Directors may be vacant.
3. The Director-President shall be in charge of all
businesses of the Company.
Article 24 The Board of Directors shall make Article 23 The Board of Directors shall makedecisions on important business and executive decisions on important business and executive
matters of the Company in addition to the matters matters of the Company in addition to the mattersas stipulated in law or this Articles of as stipulated in law or this Articles of56

Article 25 (omitted)

Proposed Changes
Incorporation, and shall monitor the Executive
Officers and Directors’ performance of duties.
2. The Director with a dual role as the President
shall convene Board of Directors Meetings andserve as the chair. In the event that there is no
Director with a dual role as the President in placeor the Director with a dual role as the President isunavailable, another Director, chosen according tothe order determined by the Board of Directors inadvance, shall take his/her place.
3. The convocation notice of a Board of Directors
Meeting shall be sent to each Director at least four(4) days prior to the meeting date.
4. A resolution of the Board of Directors shall bepassed when a majority of Directors with voting
rights are present and a majority of which havevoted for such resolution.
5. If all Directors have given approvals, in writingor electronically, on the Board of Directors’
resolution matters, such matters shall be deemedas passed as Board of Directors Meeting
resolutions.
6. The proceedings of the Board of Directors
Meeting (its outline, result and other matters asprescribed by law) shall be noted and recorded inminutes, which shall be signed, fixed seal to orelectronically signed by the Directors who
attended the meeting. The minutes shall be kept at
the Company’s headquarters for 10 years.
Article 24 (as present)

Chapter 5 Auditor and Audit & Supervisory Board(Deleted)

Current Articles of Incorporation
Incorporation.
2. The Director-President shall convene Board of
Directors Meetings and serve as the chair. In theevent that there is no Director-President in place or
the Director-President is unavailable, another
Director, chosen according to the order determinedby the Board of Directors in advance, shall takehis/her place.
3. The convocation notice of a Board of Directors
Meeting shall be sent to each Director and Auditor
at least four (4) days prior to the meeting date.
4. A resolution of the Board of Directors shall bepassed when a majority of Directors with voting
rights are present and a majority of which havevoted for such resolution.
5. If all Directors have given written or electronic
approvals, in writing or electronically, on the
Board of Directors’ resolution matters, suchmatters shall be deemed as passed as Board of
Directors Meeting resolutions; provided, that no
objection was raised by the Auditor(s).
6. The proceedings of the Board of Directors
Meeting (its outline, result and other matters asprescribed by law) shall be noted and recorded inminutes, which shall be signed, fixed seal to orelectronically signed by the Directors and Auditors
who attended the meeting. The minutes shall be
kept at the Company’s headquarters for 10 years.

Article 26 The Company shall have up to five (Deleted)
Auditors.
Article 27 The Company shall establish an Audit (Deleted)& Supervisory Board.
Article 28 Auditor(s) shall be elected by resolution (Deleted)of a Shareholders’ Meeting.
2. The attendance of at least one-third (1/3) of theshareholders with voting rights is required for theelection of Auditor(s).
Article 29 Term of office of an Auditor shall (Deleted)continue until the conclusion of the annual
Shareholders’ Meeting for the last business year
which ends within four (4) year from the time of
his or her election.
2. The term of office of an Executive Officer
elected to fill a vacancy shall continue until the
expiry of term of office of the auditor who left theoffice.
Article 30 The members of the Audit & (Deleted)
Supervisory Board shall be elected from thefulltime Auditors.
2. The Audit & Supervisory Board may electstanding Auditors from the full-time Auditors.
Article 31 The Audit & Supervisory Board may (Deleted)make decisions on matters related to the executionof Auditors’ duties, in addition to the auditors’
57Current Articles of Incorporation
authorities granted by law; provided that the Audit& Supervisory Board shall not interfere with theexercise of authorities by the Auditors.
2. In principle, the Audit & Supervisory Board
Meeting shall be convened by the Auditor
designated by the Audit & Supervisory Board,
who shall also serve as the chair.
3. The convocation notice for Audits shall be sent
to each Auditor at least four (4) days prior to themeeting date.
4. A resolution of the Audit & Supervisory Board
shall be passed when a majority of Auditors voted
for such resolution, unless otherwise required bylaw.
5. The proceedings of the Audit & Supervisory
Board Meeting (its outline, result and other mattersas prescribed by law) shall be noted and recorded
in minutes, which shall be signed, fixed seal to orelectronically signed by the Auditors who attended
the meeting. The minutes shall be kept at theCompany’s headquarters for 10 years.
Article 32 To the extent permitted by law, theCompany may, by resolution of the Board of
Directors, exempt its Auditors (including former
Auditors) from liabilities.
(Newly Established)(Newly Established)(Newly Established)(Newly Established)

58

Proposed Changes(Deleted)

Chapter 5 Nomination Committee, Audit
Committee and Remuneration Committee
Article 25 The Nomination Committee, Audit
Committee and Remuneration Committee
members shall be elected from the Directors by
resolution of the Board of Directors.
Article 26 The Nomination Committee shalldetermine the content of agenda items for election
and dismissal of Directors to be submitted to the
Shareholders’Meeting.
The
Nominationcommittee shall refer candidates for Executive
Officers to the Board of Directors after selection
and the Board of Directors shall give utmost
respect to such nominations.
2. The Audit Committee shall audit the executionof the duties of Executive Officers and Directors
and prepare audit reports and shall determine thecontent of agenda items to be submitted to the
Shareholders’ Meetings regarding election anddismissal of accounting auditors and not reelecting
accounting auditors.
3. The Remuneration Committee shall determine
the policy concerning the determination of and thecontent of the compensation, etc. for individual
Executive Officers and Directors. The same shallapply if the Executive Officer is concurrently an
employee of the Company.
Article 27 Matters concerning each committee
shall be determined in accordance with the rules ofcommittees determined by the Board of Directors
in addition to law and this Articles ofIncorporation.

Current Articles of Incorporation(Newly Established)

Proposed Changes
Chapter 6 Executive Officers(Newly Established)

Chapter 6 External Auditor

Article 28 Executive Officers of the Company
shall be elected by resolution of the Board of
Directors.
Article 29 Term of office of an Executive Officer
shall continue until the conclusion of the Board of
Director meeting first convened after theconclusion of the annual Shareholders’ Meetingfor the last business year which ends within one(1) year from the time of his or her election.
2. The term of office of an Executive Officer
elected as an addition or to fill a vacancy shallcontinue until the expiry of term of office of other
Executive Officers.
Article 30 The Board of Directors shall elect byresolution a Representative Executive Officer fromthe Executive Officers.
2. The Board of Directors shall elect by resolution
a President and Chief Executive Officer and, if
necessary, a few Executive Vice Presidents, Senior
Managing Executive Officers and Managing
Executive Officers from the Executive Officers.
Article 31 To the extent permitted by law, theCompany may, by resolution of the Board of
Directors, exempt its Executive Officers(including former Executive Officers) from theindemnification liabilities under Article 423,
Paragraph 1 of the Companies Act.
Chapter 7 External Auditor

Articles 33-34 (as present)

Articles 32-33 (as present)

Chapter 7 Calculation

Chapter 8 Calculation

Articles 35-38 (omitted)

Articles 34-37 (as present)(Newly Established)(Newly Established)(Newly Established)(2) Reasons for the Proposal
Switching to a three committee structure separates monitoring of management and execution, andtherefore allows more meaningful and effective oversight,13 and better enables the Company to achieve
its long-term growth potential and corporate value. Establishing a nomination committee and a
remuneration committee will also increase transparency for all stakeholders. By August 2019, 76.3% of
the JPX-Nikkei 400 companies have voluntary or legally established nomination committees and 77.6%
have established remuneration committees, and the numbers have been increasing every year.14 The
establishment of a remuneration committee is hoped to help the management of the Company, which has
yet to set an ROE target, gain the motivation to develop an ROE target if, for example, it implements anequity-linked compensation plan.
The Company has a particularly acute need for a legally established independent nomination andremuneration committee, given its lack of any truly independent Outside Directors.15 Based on ourstewardship responsibilities, we propose that the Company adopt the three committee structure.
13
14

15

Principle 4.6 of Japan’s Corporate Governance Code.
Tokyo Stock Exchange, Inc., Report on Appointment of Independent Directors and Establishment of Nomination andRemuneration Committees by TSE-Listed Companies (August 1, 2019), https://www.jpx.co.jp/english/listing/others/indexecutive/tvdivq0000001j9j-att/b5b4pj000002zfp5.pdf.
Principles 4.6 and 4.11 of Japan’s Corporate Governance Code; Ministry of Economy, Trade and Industry, Practical
Guidelines for Corporate Governance Systems, see FN 16 infra.

59

Opinion of the Company’s Board of Directors on Proposal No. 9
The Company’s Board of Directors opposes Proposal No. 9.
Reason for opposition
As the Company already announced on April 30, 2020, the Board of Directors has decided toestablish a voluntary nomination and compensation committee composed primarily of outside
directors based on the Corporate Governance Code of Japan (Please refer to “Notice on
Establishment of Nomination and Compensation Committee” released by the Company on April 30,
2020, for more information on the Company’s reasons for introducing this committee).
This shareholder proposal calls for the legally mandated, not voluntary, introduction of anomination committee and a remuneration committee.
Although the Companies Act requires that one of three organizational designs (a Company withThree Committees, a Company with an Audit & Supervisory Committee, and a Company with a
Board of Corporate Auditors) be adopted, there is no single superior system, and each company
should select a structure in accordance with their individual circumstances and policies.
The Company believes that the best choice at the current point in time is to select the structure ofa Company with a Board of Corporate Auditors that can carry out audits with strong and unitary
authority, and to establish a nomination and compensation committee on a voluntary basis.

Proposal No. 10: Revisions to a Portion of the Articles of Incorporation (Abolish Sodanyaku /Komon System)(1) Summary of the Agenda Item
The following provision shall be added as a new Article in the existing Articles of Incorporation andshall be modified to reflect the formalistic changes required (including but not limited to renumbering of
the articles) to account for the other agenda items in the shareholders’ meeting (including agenda items
related to Company proposals) that are approved:
Article 23-2 The Company shall not establish advisory positions, such as sodanyaku or komon, withwhom the Representative Executive Officer consult on the general or specific businesses of the Company.
(2) Reasons for the Proposal
The METI Guidelines provide that when a former president remains at a company as a
komon/sodanyaku, he or she may exercise unreasonably influential power on the current management.16
Even if he or she does not actively exercise such power, the current management may hesitate to makebold decisions or implement reforms that conflict with the former president’s past decisions.
The Company currently retains four komon/sodanyaku with remuneration. All four of them are former
presidents of the Company. The Company’s Medium-Term Management Plan aims to achieve growththrough innovation. Management that hesitates to make bold decisions and implement reforms may render
growth through innovation difficult to accomplish.
Accordingly, abolishment of the komon/sodanyaku system is an essential reform for the Company’s
operation, which will enable the Company’s management to make bold decisions, implement necessary
corporate governance reforms and drive its business toward a profitable future.

16

See Ministry of Economy, Trade and Industry, Practical Guidelines for Corporate Governance Systems, p. 34,
https://www.meti.go.jp/english/press/2017/pdf/0331_005b.pdf.

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Opinion of the Company’s Board of Directors on Proposal No. 10
The Company’s Board of Directors opposes Proposal No. 10.
Reason for opposition
The advantages of having advisors (soudan-yaku) and consultants (komon) who are notprescribed by law can be found in their contributions to enhancing the Company’s social standing
through providing advice to the Representative Directors drawing on their wealth of experience,external activities leveraging their accumulated abundant human network, and social contribution
activities primarily as senior officers at industry, public, and other organizations.
The Company’s advisors and consultants serve the roles described above. In comparison, thebusiness execution of the Company is properly carried out by the management team, including thePresident, under the independent and effective supervision of the Board of Directors. Furthermore,
the Company’s advisors and consultants do not attend any meetings related to management
decision-making, and do not interfere with or influence management decision-making in any way.
The Company also strives to ensure transparency by voluntarily disclosing information on advisorsand consultants in the Corporate Governance Report.
The Company’s Board of Directors will continue to examine the rationale of having advisors andconsultants. Based on this policy, we have decided that it is not necessary at this General Meeting of
Shareholders to venture to partially revise the Articles of Incorporation and establish a new Article
to abolish advisors and consultants.

End

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Instructions for Voting via the Internet
If you exercise your voting rights via the Internet, please view “4. Information on Exercise of Voting Rights”
on page 2 and the following matters before you exercise your rights by 5 p.m. (Japan time) on Thursday, June25, 2020.
1. About the voting rights exercise website(1) For the exercise of voting rights via the Internet (available in Japanese only), please use the voting rights
exercise website (https://evote.tr.mufg.jp/) designated by the Company from either a personal computer or
smartphone. (However, the website will be inactive between 2 a.m. and 5 a.m. each day.)(Note) Voting rights cannot be exercised by feature phone, PDA, or gaming devices, etc.
(2) If firewalls, etc., are in use for the Internet connection, antivirus software is in use, or proxy servers are inuse, etc., it may not be possible to use the website depending upon the Internet environment of theshareholder.
(3) Although the exercise of voting rights via the Internet will be available until 5 p.m. on Thursday, June 25,
2020, please exercise in advance in consideration of vote counting, and please contact our inquiry in 4.
below with any questions, etc.
2. Exercise method for voting rights via the Internet(1) Please use the “Login ID” and “Temporary password” on the enclosed Voting Rights Exercise Form on
the above voting rights exercise website, and indicate your vote for or against the proposals by following
the on-screen instructions.
By reading the “QR code for Login” on the Voting Rights Exercise Form with your smartphone, you can
automatically connect to the voting rights exercise website and exercise voting rights (It is not necessary
to input “Login ID” and “Temporary password.”). Exercise of voting rights using the QR code is possible
only once. From the second time onward, it will be necessary to input the “Login ID” and “Temporary
Password.”(2) To prevent unauthorized access by non-shareholders (so-called “spoofing”) and falsification of thecontent of the exercise of voting rights, the Company requests a change in the “Temporary password” via
the voting rights exercise website.
3. Expenses arising due to accessing the voting rights exercise website
Please note that the shareholder is solely responsible for any expenses (Internet connection fees, etc.)
incurred while accessing the voting website.
4. Inquiries
Stock Transfer Agency Department (Help Desk), Mitsubishi UFJ Trust and Banking Corporation
Telephone: 0120-173-027 (Toll-free)Business Hours: 9 a.m. – 9 p.m. (Japan time)< For institutional investors>
Institutional investors may exercise your voting right using the voting platform operated by ICJ, Inc.

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